Kerala High Court- U.S. Technology International Pvt. Ltd. vs. The State of Kerala & Ors. :WP(C) No. 14760 of 2025
Background: The petitioner challenged an adverse assessment order for FY 2018-19 where tax was demanded due to a mismatch between GSTR-3B and GSTR-2A figures. The petitioner claimed this discrepancy stemmed from a data duplication error in their ERP system related to telecom invoices and asserted they were denied a reasonable opportunity by the Adjudicating Authority (3rd respondent), who scheduled hearings prematurely, culminating in an ex-parte order. Following the initial rejection of their rectification request, the petitioner filed an appeal, but the Appellate Authority (2nd respondent) rejected the voluminous supporting documents, holding that the petitioner failed to satisfy the criteria for accepting additional evidence under Rule 112 of the CGST Rules.
Decision: The High Court by quashing the Appellate Order, held that the Adjudicating Authority did not provide a proper opportunity, particularly by scheduling a personal hearing before the 30-day reply period expired. The Court critically ruled that the Appellate Authority erred in rejecting the additional evidence, emphasizing that given the inadequacy of the initial opportunity and the statutory prohibition on remanding GST cases, the Appellate Authority was mandated to adopt a “liberal approach” and accept the relevant documents under Rule 112(1)(c). Consequently, the matter was remitted to the 2nd respondent with a direction to accept the documents, reconsider the appeal on its merits based on the new evidence, and pass a fresh order within three months.
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