GST / Indirect Tax : High Court Sets Aside the GST Demand Raised by Department Arising out of GST Evasion Allegations

GST / Indirect Tax : High Court Sets Aside the GST Demand Raised by Department arising out of GST Evasion allegations

In an interesting case, the issue was related to validity of  Order dated 01.02.2025 whereby Tax Department not only rejected / denied the request of the petitioner for cross-examination of the L & T representative but also confirmed the GST demand made against the petitioner together with penalty, interest etc., aggrieved by which, petitioner filed petition before High Court. Department has alleged evasion of GST

Petition filed against the Order of Tax Department was allowed and Order of Tax Department was set aside with following observations : - 

It was necessary to provide an opportunity in favour of the petitioner wherein cross-examine the persons making alleged statements in order to test their veracity. 

Department fell in error in declining to provide an opportunity to the petitioner to examine / cross-examine the L & T representatives whose statements had not only been recorded by the respondents during investigation but the same were relevant, material and germane and had been relied upon by the Tax Department in the impugned order without providing an opportunity to the petitioner to discredit or impeach the veracity of the statement and the credibility of the said L & T representatives thereby resulting in erroneous conclusion.  

Reference : JSW Steel Ltd v. Joint Commissioner of Central Tax [2025] GCtR 1637 (Karnataka)