None of the documents were requested by the GST officers in the SCN, thus the order cannot be sustained, observed the court.

In a matter, the Madras High Court ruled that the GST ( goods and Service Tax ) liability confirmed for non-furnishing of documents not requested in the SCN ( Show Cause Notice ) is invalid. The court remanded the matter for reconsideration. The bench of Justice Senthilkumar Ramamoorthy observed that “As regards the second issue, the tax proposal was confirmed on the ground that the petitioner did not establish movement of goods by producing lorry receipts, weighment slips and payments made to the supplier. None of these documents were called for in the show cause notice which proceeded on a completely different basis. Therefore, the impugned order cannot be sustained.” Slitina Metal Sales LLP, assessee- petitioner has contested the GST order on multiple grounds. The assessee received a show cause notice, addressing two primary issues. The first issue concerned the claim of Input Tax Credit ( ITC ) on commodities allegedly ineligible under sub-section (5) of Section 17 of the applicable GST statutes. The second issue involved ITC claims for supplies from cancelled dealers who had not remitted tax dues. In response, the assessee submitted a detailed reply, including invoices and e-way bills related to supplies from M/s. VK Impex, along with proof of the supplier’s GST return filings. The assessee explained that MS Scrap was purchased from three suppliers for business purposes. The impugned order failed to address the first issue concerning ITC claims on MS Scrap, submitted by the legal representative of the Slitina Metal. Furthermore, regarding the second issue, the counsel noted that the assessee was not asked to provide details on the movement of goods. The show cause notice mentioned that the supplier’s registration had been cancelled and taxes were unpaid, but the assessee had already provided proof of tax payment by the supplier. The GST department’s counsel contended that, according to Sections 16 and 155 of the GST Act, the burden of proof regarding ITC rests with the taxpayer. Since the petitioner did not submit additional documents like lorry receipts and weighment slips, the assessing officer was compelled to uphold the tax proposal. The High court reviewed the show cause notice and it was clear that it addressed two issues: ITC on allegedly ineligible commodities under Section 17(5) of GST law and ITC claims related to a supplier who had not paid taxes. Further noted that the assessee responded to both concerns, asserting that materials under HSN Code 7204 were used in business and did not fall within Section 17(5). Additionally, the assessee demonstrated that the supplier, despite having a cancelled registration, had paid taxes, supported by relevant invoices, e-way bills, and returns. The high court observed that the impugned order confirmed the tax proposal on the second issue, citing the lack of proof for the movement of goods, such as lorry receipts and weighment slips. These documents were not required by the original GST show cause notice, which focused on different issues, stated the court. The matter was remanded back for reconsideration without any pre-deposit and permitted the assessee to submit an additional reply with all relevant documents related to the movement of goods within fifteen days of receiving the court’s order. Accordingly, the department was instructed to provide a reasonable opportunity for a personal hearing and issue a fresh order within three months from receiving the additional reply. To Read the full text of the Order CLICK HERE