2026-VIL-325-P&H
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SGST High Court Cases

GST - Vague and incorrect Show Cause Notice purportedly issued based on the findings of a Special Audit conducted by the Comptroller and Auditor General (CAG) of India - Whether the show cause notice is sustainable given the factual inaccuracy and vagueness of the allegations made therein – HELD - The SCN is not based on an audit conducted by the CAG, as stated, but by the State GST Department. The report of the Audit was never supplied to the petitioner. Further, the SCN failed to provide the basis for the various allegations made, such as excess input tax credit availed, mismatch in input tax credit, and undischarged tax liability - The purpose of a Show Cause Notice is to make the assessee aware of the department's intent and enable them to effectively respond, which a vague and non-specific notice does not fulfil - Serving of a non-specific notice is nothing but an empty formality which does not fulfil the afore object and is even otherwise, violative of the principles of natural justice. Not only should the notice be specific and detailed, the material which forms the basis of the notice, should also be supplied to the assesee alongwith the notice – The Section 73(3) of the CGST Act, 2017 makes it clear that “details” of tax not paid or short paid or erroneously refunded or input tax credit wrongly availed or utilised have to be brought to the assesse’s notice through the SCN. In the case in hand, the impugned show cause notice is not only based on a wrong premise but is also found to be utterly vague and bereft of any details as are required to be furnished under Section 73(3) of the Act - The impugned notice is set aside with liberty to the authorities to proceed against the petitioner, in accordance with law – The petition is disposed of
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