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Company challenges Rs 7.9 Crore GST demand for excess & ineligible tax credits, claiming their detailed response was ignored. The court finds the tax authority's order flawed and demands proper consideration of the company's explanation.

A company (petitioner) is contesting a tax demand order issued by the Goods and Services Tax (GST) department. The order, dated December 23rd, 2023, imposed a significant tax penalty on the company.

Grounds for Challenge:

  • The company argues that their detailed response to the initial show cause notice (SCN) was completely ignored in the final order.
  • The final order simply states the company's reply was "not satisfactory" without providing specific reasons or requesting further clarification.
  • The company believes the GST department failed to properly consider their explanation for the disputed tax issues raised in the SCN.

Court's Decision:

The court sided with the company, finding the final order flawed:

  • The court deemed the order insufficient as it didn't address the company's response to the SCN.
  • The court criticized the GST department for not requesting additional information if they found the initial response unclear.


  • The court quashed the original tax demand order.
  • The case was remanded back to the GST department for proper re-evaluation.
  • The GST department is now required to:
    • Specify the details or documents they need from the company for further clarification.
    • Grant the company the opportunity to respond and provide any requested information.
    • Issue a new, well-reasoned order within the legal timeframe after considering the company's input.

Topic-Mother Dairy Fruit & Vegetable Private Limited Versus Sales Tax Officer

Citation-2024 TAXONATION 950 (DELHI)




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