Recovery of GST, Interest Penalty –without conducting inquiry --––- The petitioner challenged the impugned order passed by the third respondent dated 28.07.2020, whereby the third respondent has imposed penalty, interest and GST, for the remittance of the shortage amount as the same was found at the time of counting the stocks, subsequent to the transfer of the same from Shop to godown. The counsel for the petitioner submitted that the third respondent has passed the impugned order without conducting a domestic enquiry. Though the petitioner has elaborately given a reply that the said amount was not a shortage amount as construed by the respondents, but it was the after sale amount that was occurred on 24.03.2020 between 4.00 p.m. and 6.00 p.m., without considering the same, the third respondent initiated a recovery proceedings, in violation of the principles of natural justice. The court observed that without conducting any such enquiry and giving the opportunity to the petitioner to explain his case, in a personal hearing, it is not proper for the respondents to arrive at a preconceived manner as if that the amount deposited subsequent to the stock taken by the respondents as shortage amount. The impugned order was passed in an arbitrary manner and in violation of the principles of natural justice.

Held that:- The Hon’ble High Court set aside the impugned order passed by the third respondent dated 28.07.2020. Since the respondents have already issued the show cause notice and the petitioner has also filed his reply, it is for the respondents, if so advised, to conduct a domestic enquiry in accordance with the procedure as laid down in the Code.