Company Disclosure: Receipt of GST Show Cause Notice
Details of the Show Cause Notice
Opposing Party: The State Goods and Services Tax (SGST) Department, Government of India.
Agency/Tribunal: Assistant Commissioner of State Tax, CT & GST Circle, Balasore, Odisha.
Financial Year: 2022-23
Total Demand Amount: ₹3,17,49,077/-
Breakdown of Demand:
- Tax: ₹1,87,60,756/-
- Interest: ₹1,11,02,255/-
- Penalty: ₹18,86,066/-
Basis of Dispute/Litigation: The Show Cause Notice raises the following major concerns:
- Short payment of GST due to overstating turnover adjustment in Form GSTR-9C
- Non-permissibility of reduction of Tax liability on issuance of breakage credit note under Section 15(3)(b) of the CGST Act for Claiming Reduction of Tax Liability through Credit Note
- Excess ITC claimed in comparison with ITC available in GSTR 2B
- Ineligible Input Tax Credit (ITC) Claimed on Blocked Credits under Section 17(5) of the CGST Act
- Non-fulfilment of Conditions Prescribed for Turnover Discounts
Company's Response and Expected Impact
The company is in the process of preparing a response to the Show Cause Notice. Everest Industries firmly believes that it maintains strong legal and factual grounds in this matter and will be taking all necessary actions to present and defend its case before the relevant authorities.
The company does not consider it likely that this potential demand will materialize as a claim against the company and result in liability. Since it is only a Show Cause Notice at this stage, there is no expected material financial impact due to compensation, penalty, etc.