Section 7 of the CGST Act — Supply of Returnable goods – The petitioner engaged in the business of manufacturing heavy equipments such as Hydraulic Excavators, Concrete Machinery, Mining Machinery, Crawler Excavator, Truck Crane, etc. The petitioner, entered into the “Machine Demo Activity Agreement” (MDAA) with the customer. The petitioner loaded the single machinery Excavator and raised a Returnable Challan only for demo approval. The respondent intercepted the consignment and detained the same. The petitioner submitted that the respondent passed order without considering their reply i.e the said transaction is not taxable under the Act, as Section 7 of the Act does not include any transaction where the goods are being sent for the purpose of “demonstration”, therefore prayed for quashing the impugned order. The Court observed that the respondent failed to deal with the said contention and has not even assigned any reason for ignoring the said contention, as such, the order is a non-speaking order.
Held that:- The Hon’ble High Court allowed the petition and set aside order and remanded the case back to the respondent with a direction that he shall give both the parties, the petitioner as well as the Revenue Department, ample opportunities to raise their contentions in their respective favour, and to pass a reasoned order, within a period of one month.—Sany Heavy Industry India Private Limited Vs. The State Tax Officer, Peddapalli Circle, Telangana [2020] 22 TAXLOK.COM 111 (Telangana)