HC Rules GST Demand Can’t Exceed Original Show Cause Notice

HC Rules GST Demand Can’t Exceed Original Show Cause Notice

The Allahabad High Court ruled in favour of the Petitioner (M/S Vibhuti Tyres). The court found that the final demand of the amount, Rs. 32.97 lakh, was illegal and much higher than the original amount of Rs. 8.81 lakh, as mentioned in the show-cause notice issued to the petitioner under Section 73 of the GST Act.

In accordance with Section 75(7) of the Act, the court clearly stated that the tax authorities cannot raise a demand in the final order that is more than what was specified in the show-cause notice. Since the rule was violated, the court ruled the order of the department invalid. It then remanded the matter back to the GST officer, directing them to give Vibhuti Tyres an equal opportunity to reply and to issue a fresh order only after following proper legal procedure.