Section 42 of the CGST Act, 2017 – Matching of ITC --––- The petitioner challenged SCN dated 31.03.2022. The issue raised in the SCN relates to the claim of ITC and the Assessing Authority has sought various particulars in regard to the procedure for matching the same while considering the grant or otherwise. Section 42 of the Act deals with matching, reversal and reclaim of ITC. The petitioner relied upon the Circular No.5 of 2021 dated 24.02.2021 issued by the Commercial Taxes, providing for the procedure to be followed in the case of verification of claims of ITC involving selling/purchasing dealers. The court observed that the challenge to the notice fails, in view of the said circular.

Held that:- The Hon’ble High Court directed the petitioner to file reply to the SCN before the Assessing Authority, who, in turn, shall complete the proceedings in light of the observations made by the court. The Officer shall scrupulously follow the stipulations under Section 42 of the Act.