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2023 (4) TMI 545 - HC - GSTValidity of assessment order - Demand of GST - Search and Seizure - Maintainability of appeal - appeal was dismissed as was beyond time limitation - Section 74 of the U.P. G.S.T. Act - wilful suppression of facts or not - Ex-parte order - no opportunity of hearing provided - principles of natural justice - HELD THAT:- In terms of the scheme of the Act, the power of search and seizure is conferred by virtue of Section 67 of the Act and the power of scrutiny of returns filed is conferred upon the proper officer in terms of Section 61 of the Act. Both the said sections 61 and 67, are step towards the initiation of the proceedings either under Section 73 or Section 74 of the Act, as the case may be. They in itself do not form any basis for concluding the evasion of tax, which has to be established by following the procedure as prescribed under section 73 and under section 74 of the Act as the case may be. Section 74 from its plain reading confers the power to assess the non-payment of tax on the supply or wrong availment of input tax credit by the reasons of fraud, wilful misstatement or suppression of facts coupled with an intent to evade tax. Irrespective of the outcome of the scrutiny of return under section 61 of the Act or the inspection carried out under section 67 of the Act, the burden of assessing the short payment of tax or wrong availment of input tax credit still lies on the department which is to be discharged by the department. To calculate and assess the non-payment of tax, it is essential that the relevant evidence is carried out by the department in respect of the taxable supplies made by the assessee and non-payment of tax which is required to be done at the time of supply as specified under section 13 of the Act. It is also incumbent on the department to compute the value of taxable supply on the goods on which it is alleged that the tax has either not been paid or short paid or short levied - Without any corroborative material, merely on the basis of discrepancies found in the scrutiny of returns or discrepancies found during the inspection is not enough to assess the tax. It is also incumbent upon the department to give the opportunity of hearing as per the Section 75(4) of the Act which is mandatory to be followed by the department. It is equally well settled that any document proposed to be relied upon should be provided to the assessee prior to conclusion of the proceedings - In the present case, the order dated 24.01.2022, clearly falls short of the principle of natural of justice as admittedly the SIB report, which is the foundation was never supplied to the petitioner, no hearing was granted to the petitioner under section 75(4) of the Act and there is prima facie no material other than the SIB report to corroborate the discrepancies as allegedly found by the SIB at the time of scrutiny of returns and inspection. The impugned order dated 24.01.2022 is unsustainable and is quashed - The matter is remanded to the adjudicating authority to pass a fresh order after supplying the copy of the SIB report and giving an opportunity of hearing to the petitioner and also an opportunity of filing a reply. Petition allowed by way of remand.
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