Facts of the Case: The petitioner, Subrat Rout, holding GSTIN 21BBPPR1202L1ZR, challenged an order dated 27.7.2021 passed under Section 73 of the Odisha/Central Goods and Services Tax Act, 2017 for the tax period December 2018, pursuant to a show-cause notice dated 30.4.2021. The demand arose from an alleged mismatch between GSTR-2A and GSTR-3B relating to receipt of Rs.15,83,500 for works executed for the Superintending Engineer, Mahanadi North Division, Jagatpur. At the time of adjudication, the petitioner's GST registration had already been cancelled, so he remained unaware of the proceedings until receiving a recovery notice dated 29.3.2025. On enquiry, it emerged that the payment in question had actually been made to a different person, "Subrat Kumar Rout" (holding GSTIN 21AWWPR3325B1ZN and PAN AWWPR3325B), and that the contractor's advocate had inadvertently entered the petitioner's GSTIN instead while filing returns/TDS details. The Superintending Engineer confirmed this clerical error by letter dated 11.4.2025.

Issues Involved:

  1. Whether a Section 73 demand founded on a GSTR-2A/GSTR-3B mismatch can be sustained against a taxpayer who, on verification, is shown to have never received the underlying payment due to a clerical GSTIN-entry error by a third party.

Petitioner's Arguments:

  • Never received any payment for the work referenced in the adjudication; the demand was raised under a mistaken notion of fact.
  • The Superintending Engineer, upon being apprised, confirmed via written communication that the payments were in fact made to a different GSTIN holder, "Subrat Kumar Rout," due to a clerical error by the advocate handling returns.
  • Sought quashing of the Section 73 adjudication order in its entirety.

Respondent's Arguments:

  • The mismatch between GSTR-2A and GSTR-3B triggered notices, and in the absence of any response, the Section 73 proceeding culminated in a demand followed by recovery action.
  • Upon verification and instructions from the Deputy Commissioner, the Department fairly conceded the factual error — confirming that bills totalling Rs.15,83,500 taxable value were paid to a different GSTIN holder, and that bank account cross-verification also showed the petitioner had not received the payments in question.

Court Order / Findings:

  • The Court found the submissions of both counsel, and the Department's own written instructions, left "no ambiguity" that the adjudication under Section 73 had proceeded against the petitioner under a mistaken fact — the proceeding ought to have been directed against "Subrat Kumar Rout," not the petitioner "Subrat Rout."
  • In view of this admitted factual position, the order dated 27.7.2021 and the show-cause notice dated 30.4.2021 were quashed, and the writ petition was allowed.

Important Clarification:

  • A Section 73 demand founded on a GSTR-2A/GSTR-3B mismatch — even where the mismatch appears valid on the face of the returns — cannot be sustained against the taxpayer named in the returns where the department itself, on verification, admits that a clerical GSTIN-entry error by a third party's return-filing agent caused the payment to be wrongly attributed, and that the named taxpayer never actually received the underlying consideration.

Sections Involved:

  • Section 73, Odisha Goods and Services Tax Act, 2017/Central Goods and Services Tax Act, 2017 — determination of tax not paid/short paid in non-fraud cases, here founded on a returns mismatch subsequently shown to be factually erroneous.

Decision – In Favour of: Assessee. Adjudication order and show-cause notice quashed.

Related Case Laws: This decision illustrates the same principle of factual-error correction seen in other Section 73 remand rulings this cycle, such as M/S Ahsan Enterprises vs State of U.P. (Writ Tax No. 1583 of 2025) and M/s N S Industrial Hardware vs Commercial Tax Officer, LGSTO-180 (WP No. 37576 of 2025), though decided on distinct grounds.

Case Details: High Court of Orissa at Cuttack | WP(C) No. 33128 of 2025 | Coram: Hon'ble the Chief Justice Harish Tandon and Hon'ble Mr. Justice Murahari Sri Raman | Date of Order: 15.12.2025.

Link to Download the Order: View/Download the Order

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