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GST - Collections for Jan highest-ever at Rs 110828 crores

GST CASES

SC CASE

2020-TIOL-41-SC-GST

UoI Vs Shabnam Petrofils Pvt Ltd

GST - Petitioners had challenged before the Gujarat High Court the validity of Notfn No  20/2018-CT(R) , which mandates that the accumulated ITC lying unutilized in balance in respect of certain specified goods, after payment of tax for and upto July 31, 2018 on inward supplies received upto such date, would lapse; that the said embargo resulted in huge losses for them; that registered persons were entitled u/s 16 of the CGST Act to claim ITC and that the CGST Act did not enable issuing of Notifications which provided for lapse of ITC; that powers u/s 54(3)(ii) of the CGST Act were limited to notifying the supplies not entitled to refund of ITC accumulated on account of the inverted rate structure & that the impugned notifications had exceeded the provisions of Section 54(3)(ii) High Court observed that the CGST Act itself provideed for lapse of ITC u/s 17(4) & 18(4) of the Act; that where the legislature wanted ITC to lapse, it would have been expressly provided; that no such express provision is made u/s 54(3); that the said section does not inherently empower the Govt to provide for the lapsing of the unutilised ITC accumulated on account of the rate of tax on inputs being higher than the rate of tax on output supplies Held that it is trite law that delegated legislation must be in conformity with provisions of parent statute and by prescribing for lapse of ITC, the Notfn No  05/2017-CT(R)  dated 28.06.2017 as amended by Notfn No  20/2018-CT(R)  dated 26.07.2018, exceeded the power delegated u/s 54(3)(ii) of the CGST Act; that therefore, proviso (ii) of the opening paragraph of the Notfn No. 05/2017-C.T. (Rate)  inserted vide Notfn No. 20/2018- C.T. (Rate)  is ex-facie invalid and liable to be struck down as being without any authority of law Revenue in appeal to Supreme Court.

Held: UOI is permitted to file rejoinder affidavit within a period of four weeks and the SLPs are to be listed on a non-miscellaneous day in the second week of April, 2020: Supreme Court

- Matter listed: SUPREME COURT OF INDIA

HIGH COURT CASES

2020-TIOL-283-HC-RAJ-GST

Tax Bar Association Vs UoI

GST - Petition has been filed by the Tax Bar Association raising the issue about non-functionality of the respondent's portal i.e. www.gst.gov.in, as a consequence of which, various assessees are unable to upload their returns both GSTR9 and GSTR9C - In view of the fact that the portal was having problems, the respondents issued a notification 6/2020-CT dated 3rd February, 2020 requiring the assessees (Rajasthan) to furnish their returns under Section 44 of the GST Act read with Rule 80 of the Rules for the Financial Year 2017-18 by 5th February, 2020; that when an assessee attempted to upload the returns/forms in GSTR9 and GSTR9C on 31.01.2020 at 5:09 PM, the website of the Govt. noted "Dear Tax Payer 1,50,000 tax payers are already submitting their returns at this moment… Please wait for your turn in a few minutes… Thank you for your patience" - Similarly attempts were made thereafter on the self-same date at 6:58 PM as well as 7:50 PM with the same result; that subsequent attempts were made by the advocates/tax consultants to upload the assessees' returns on 3rd February as well as 4th February, 2020 (in view of the extension granted) but in spite of several such attempts, they have not been able to upload the same; that on verification of the portal on 5th February, it appears that software glitch requiring the assessee to deposit "late fee" has been corrected and attempts are being made by various assessees within the State to upload their returns/forms in course of the day.

Held: Keeping the aforesaid situation being faced by assessee in view, Bench is of the considered opinion that an interim order needs to be passed in light of the fact that the GST portal of the Govt. of India has not been effectively functioning and clearly there appears to be a physical limit, to which extent returns/forms can be uploaded on any one day (apart from admitted intermittent technical shutdowns) - Bench is prima facie satisfied that even if an assessee is ready and willing to comply with the statutory duty, so far as filing of returns are concerned, the website appears to be having technical bottlenecks, which appears to limit the opportunity of an assessee from uploading the forms - Consequently, Bench directs that the petitioner Association and the assessee, for whom they represent, may keep uploading their returns at the earliest possible and it is directed that no late fee shall be charged till 12th of February, 2020 for uploading - The respondents are directed to enable compliance of such uploading by making necessary/consequential corrections on its official portal - Bench also directs that the Union of India may file an affidavit by the portal operators regarding the status of its working and the magnitude or the ability of such portal or system for accepting a requisite number of returns/forms; that if necessary, the Union of India may also direct the service provider to enhance its capacity to accept returns/forms - Since it is well-settled that where the last date of submission has been prescribed by law, it would be incumbent on the part of the revenue to provide for adequate facility for accepting such declarations or returns or forms within the period stipulated - Matter to be listed on 12.02.2020: High Court

- Interim order passed: RAJASTHAN HIGH COURT

2020-TIOL-282-HC-JHARKHAND-GST

Mahaveer Prasad Vs State Of Jharkhand

GST - Jharkhand Goods and Services Tax Act, 2017 [Act] -Availment of input tax credit on the basis of forged invoices - Apprehending his arrest, the petitioner has moved the High Court for grant of privilege of anticipatory bail in connection with a case registered under sections 120(B)/415/420/425/464/468/471 of the Indian Penal Code read with sections 132(1)(b)/132(1)(c)/132(1)(e) and 132(1)(1) of the Act - the counsel for the petitioner relied upon the judgment of the Madras High Court in the case of Jayachandran Alloys (P) Ltd. - 2019-TIOL-1021-HC-MAD-GST  and submitted that the power to punish and set out offence under section 132 of the Act can only be set in motion after it is established that an assessee has committed an offence which can be arrived at only after determination of the demand due from the assessee - the counsel for the petitioner next relied upon the order of the Division Bench of Gujarat High Court in the case of Vimal Yashwantgiri Goswami - 2019-TIOL-1746-HC-AHM-GST wherein the Gujarat High Court has observed that prosecution under section 132 of the Act should normally be launched only after the adjudication is completed in terms of 73 and 74 of the Act - the counsel further submitted that the petitioner in the meanwhile has voluntarily reversed Rs.8.57 crores from his electronic ledger to set right the alleged illegal and fraudulent Input Tax Credit of Rs.8.57 crores for which this F.I.R. has been lodged - it is next submitted that the petitioner is ready and willing to furnish sufficient security including cash security and undertakes to cooperate with the investigation of the case

- Anticipatory Bail Application disposed of: JHARKHAND HIGH COURT

2020-TIOL-273-HC-MUM-GST

Nelco Ltd Vs UoI

GST - Petitioners have challenged the denial by the Respondents to carry forward the Input Tax Credit from the pre-GST regime - Petitioners have argued that the Rule 117 of CGST, 2017 is ultra vires the CGST Act - Writ petition to stand over to 13 February 2020: High Court [para 1, 3]

- Matter listed: BOMBAY& HIGH COURT

2020-TIOL-272-HC-DEL-GST

IFB Industries Ltd Vs National Anti-Profiteering Authority

GST - Anti-profiteering - Authority had held that the additional benefit given to one recipient cannot be offset with the denial of benefit to another recipient as this is not the spirit of the law; that the aggregate profiteering has to be computed on the basis of what each consumer has lost due to non-reduction of the prices in a commensurate manner by the respondent; that profiteering has to be computed at the level of each invoice and not at the entity level or any consolidated level; that the amount profiteered by the respondent (applicant herein) is Rs.67,28,592/- and the same has to be deposited along with interest in the Consumer Welfare Fund of the Central and State Governments in the ratio 50:50 as the recipients are not identifiable; that the amount is required to be deposited within three months failing which the same is required to be recovered by the Commissioners of the Central and State GST under the supervision of DGAP and an action taken report is to be submitted within a period of four months; that penalty is also imposable - Writ petition filed against this order before the High Court.

Held: Bench stays the operation of the direction issued by the authority in the impugned order in paragraphs No. 46 and 47 - Bench makes it clear that it has not restrained the respondents from undertaking an enquiry if justified, independent of the directions issued in the impugned order; that the deposit made by the petitioner in terms of the impugned order shall be subject to further orders in the writ petition - Counter affidavit to be filed within 8 weeks and rejoinder is to be filed before the next date of hearing - Matter listed on 16.09.2020: High Court [para 7, 8, 10, 11]

- Matter listed: DELHI HIGH COURT

020-TIOL-271-HC-DEL-GST

Sales Tax Bar Association Vs UoI

GST - Grievances raised by the petitioner are numerous - Several of them have been raised and resolved, while several others remain unresolved - A lot of the issues arising before the Bench relate to the apparent technical flaws, glitches and limitations in the online portal system evolved by GSTN - On querying, Bench is informed that Infosys Limited and Tech Mahindra Limited have been entrusted the task of evolving and maintaining the GSTN Network for IT support - Bench opines that with a view to better appreciate the intricacies and to ensure that the grievances raised by the taxpayers, whose interest the petitioner association represents, Bench considers it necessary to have Infosys Limited and Tech Mahindra Limited present before the Bench to receive their assistance, as and when required - Directions issued to issue Court notice to Infosys Limited and Tech Mahindra Limited in the aforesaid context - Notice returnable on 20.02.2020 - respondents are directed to produce deliberations of the GST Policy Wing and the recommendations of the Council in terms of paragraph 3 of order dated 31.10.2019 - 2019-TIOL-2525-HC-DEL-GST : High Court [para 10 to 12, 14]

- Notice issued: DELHI HIGH COURT

 

2020-TIOL-265-HC-GUW-GST

All India Federation of Tax Practitioners Vs UoI

GST - Petitioner submits that non-functioning of GST portal system for a couple of days including on 31.1.2020 which happened to be the last date for submitting GSTR-9 and 9C returns is the cause of filing the petition - that, on grievance being raised, a ticket is issued, which however, without resolution expires; that representations are made which also find reflected on the GST portal, however, no decision in regard to representations is taken.

Held: It is the conceded position that the date for filing return has been extended till 7.2.2020 and in such circumstances, no adjudication is required on the petition - respondent would also address the issue of extending the time for 30 days, so far as filing of GST Returns in the State of Assam, Nagaland, Mizoram and Arunachal Pradesh is concerned, in view of peculiar conditions prevalent in these States - Petition disposed of: High Court [para 5, 6]

- Petition disposed of: GAUHATI HIGH COURT

2020-TIOL-264-HC-KERALA-GST

PM Saleem Vs STO

GST - Petitioners seek a writ of mandamus or other appropriate writ or direction declaring that the action of the respondents to block GST registration is illegal and unsustainable in law; to issue a writ of mandamus or other appropriate writ or direction directing the respondents to permit the petitioners to purchase goods and other articles with their GST registration without any kind of obstruction.

Held: It is the admitted case of the petitioners that they have not paid the tax dues pursuant to the assessment orders rendered for the respective assessment years and that petitioners would contend that petitioners will be prosecuting statutory appeals to impugn the legality and correctness of the said assessment orders and that in the meanwhile, due to default in such payments, respondents have blocked the GST registration itself - Respondents submit that since the petitioners have not paid due tax amounts for the relevant periods and they did not file mandatory returns till day, blocking of E- way bill is made on account of mandatory provision contained in the Rule 138E of CGST Rules, 2017 and unblocking of E-way bill is possible only if the due amounts as envisaged in the said Rule are remitted and the returns are filed up to date - It is for the petitioners to take necessary steps to ensure that due tax amounts are paid, so that, the default in that regard is not for more than a period of two months as envisaged in clause (b) of Rule 138E(1) of the Rules - In case the petitioners wish to prosecute statutory appeals to impugn the assessment orders for the years concerned, it is for the petitioners to avail such remedies, in accordance with law - Petition disposed of: High Court [par 5, 6]

- Petition disposed of: KERALA HIGH COURT

2020-TIOL-263-HC-MUM-GST

Glenmark Pharmaceutical Ltd Vs UoI

GST - Anti-Profiteering - Petitions inter alia raise a challenge to the constitution of National Anti Profiteering Authority - Counsel for the Respondents informed the Bench that in some of the Petitions, the Respondents have moved a transfer application in the Supreme Court and the decision of the Supreme Court on the transfer application is awaited – in view thereof, hearing of the petitions is deferred to 11 th March 2020 - Respondents are directed to adjourn the proceedings pending before the authorities beyond the next date and if the Respondents seek to implement the impugned order, they shall give advance notice to the Petitioners: High Court [para 2, 3]

- Matter posted: BOMBAY HIGH COURT

2020-TIOL-249-HC-AHM-GST

Anmol India Ltd Vs UoI

GST - The petitioner-company is engaged in importing non-coking Coal from abroad - It approached the writ court seeking certain relief, namely that directions be issued to quash the Notfn No 8/2017 Integrated Tax (Rate) dated 28.06.2017 and Entry 10 of the Notification No. 10/2017 Integrated Tax (Rate) dated 28.06.2017 on account of them being ultra vires for want of legislative competency - The petitioner also sought that a declaration be issued to the effect that no IGST be levied on Ocean Freight for services supplied by a person located in non-taxable territory, through transportation of goods by a vessel from a place outside India up to the Customs station of clearance in India and levy and collection of tax on such ocean freight be deemed to be impermissible under law - It was further sought that pending disposal of the petition, the court stay the operation of Notfn No 8/2017 Integrated Tax (Rate) dated 28.06.2017 and Entry 10 of the Notification No. 10/2017 Integrated Tax (Rate) dated 28.06.2017 and also stay the levy and collection of IGST on ocean freight on transport of goods in a vessel from a place outside India upto the Customs station of clearance in India by a person located in non-taxable territory. Held - The present petition need not be adjudicated any further, in light of the judgment pronounced by this court in Mohit Minerals Pvt.Ltd vs Union of India - It had been held therein that no IGST is leviable on ocean freight for the services provided by a person located in a nontaxable territory by way of transportation of goods by a vessel from a place outside upto the Customs station of clearance in India and the levy & collection of such tax is impermissible - Moreover, the Notfn No . 8/2017-Integrated Tax (Rate) and the Entry 10 of the Notification no. 10/2017-Integrated Tax (Rate) had been declared ultra vires - Hence the present petition is disposed of: HC

- Writ petition disposed of: GUJARAT HIGH COURT

2020-TIOL-248-HC-KERALA-GST

MR Traders Vs Assistant State Tax Officer (INT)

GST - The petitioner, a partnership firm, holds GST registration in Kerala and Karnataka - It is engaged in the business of Timber & Timber products - The petitioner generated invoice for supply of timber logs from Karnataka to Kerala - The petitioner calculated and paid 9% CGST and 9% SGST - An e-way bill was generated to transport the goods - The goods had been declared while generating e-way bill - The petitioner had opened a new branch at Malappuram where the goods were to be transported - The petitioner did all in its stead to ensure that details of the new branch were updated on the website, but the same only showed as 'processing' - When the e-way bill was generated, the petitioner was under the impression that the new branch's address would have appeared on the e-way bill - Later, the goods were seized by the Revenue authorities when they were being unloaded at the premises of the new unit - Notice was issued to the petitioner u/s 129(3) of the CGST Act and SGST Act and u/s 20 of the IGST Act - The goods were seixed and penalty was imposed on grounds that the tax invoice and e-way bill listed some other address and no document was accompanying to unload the goods at the new unit - The vehicle carrying the goods had been seized as well - The petitioner filed its reply to the SCN clarifying its position - The present writ was filed with the petitioner claiming that the seizure of the goods and the vehicles was complete illegal and on account of it incurring demurrage and extra container charges on a daily basis, which caused a financial drain - The petitioner also claimed there to be no intent to evade payment of taxes. Held - The vehicle and the goods be release immediately upon the petitioner furnishing the amount of bank guarantee - The matter would then be taken up for finalisation of adjudication proceedings with opportunity of personal hearing being given to the petitioner - The Revenue authorities are also directed to consider the petitioner's contention that the so-called error that the address shown in the invoice is different from the address shown in the E Way bill, is only a clerical error and not so serious so as to warrant detention and penalty proceedings: HC

- Writ petition disposed of: KERALA HIGH COURT

2020-TIOL-246-HC-MUM-GST

Gehna Trading LLP Vs UoI

GST - Petitioner challenges the action of the respondents in provisionally attaching their bank account - same was pursuant to a communication by the Dy. Commissioner, CGST informing the Bank Manager that in view of the proceedings filed against one Yusuf Fauzdar Shaikh, proprietor of M/s. Fashion Creations, proceedings have been launched against the said taxable person and the Respondents were of the belief that amounts were being transferred to various persons, including the Petitioner - Petitioner submitted that there are no proceedings under Sections 62, 63, 64, 67, 73 and 74 against the Petitioner as mentioned u/s 83 of CGST Act, which is necessary if attachment u/s 83 is to be levied - Petitioner relies upon the decision in Kaish Impex Pvt. Ltd - 2020-TIOL-151-HC-MUM-GST involving identical facts and wherein it is held that even though specified proceedings have been launched against one taxable person, bank account of another taxable person cannot be provisionally attached merely based on the summons issued under section 70 to him - Writ Petition is allowed and the order passed by the Respondent dated 6 December 2019 attaching the bank account of the Petitioner is quashed and set aside: High Court [para 3, 4]

- Petition allowed: BOMBAY HIGH COURT

2020-TIOL-230-HC-KERALA-GST

Umiya Enterprise Vs ASTO

GST - The petitioner is a registered dealer in plywood, particle boards and allied items - Petitioner's main supplier M/s. Rukmoni Boards Pvt. Ltd, Chennai despatched plywood under cover of valid invoice and E-Way bill on 10.1.2020 to the petitioner - The 1st respondent intercepted the conveyance containing the consignment invoking the provisions in Sec.129 alleging the defects that no IGST is seen collected in the tax invoice which amounts to contravention of Sec.5(1) of the IGST Act read with Rule 46(e) & (m) of the CGST Rules - Petitioner was called upon to show cause as to why an amount of tax Rs.1,20,985/- and the same amount as penalty under the IGST Act should not be imposed - In Ext.P-1 invoice the element of tax happened to be wrongly shown as CGST and SGST @ 9% as against IGST of 18% - This, the petitioner submits, is an inadvertent mistake committed by the new Accountant of the supplier, however, in E-way Bill the tax has been correctly declared as IGST Rs.1,20,985/- - Petitioner submits that the clerical error in the invoice will not prejudice the Revenue in any manner and the returns will automatically set right such trifling errors in documentation; that, therefore, the E-Way bill having been correctly generated, any adverse presumption of tax evasion is wholly out of context and untenable - It is also submitted that as per the provisions in Sec.126 of the GST Act dealing with the general disciplines related to penal proceedings are not to be initiated for minor breaches of tax regulations or procedural requirements, omission or mistake in documentation – However, the 1st respondent is not inclined to release the goods without payment of tax and penalty and, therefore, the petitioner has filed the instant Writ Petition.

Held: It is to be noted that the matter in relation to the detention of the goods as per the impugned Ext.P7 proceedings will have to be subjected to adjudication proceedings and only thereafter it can be finalised - Therefore, Court need not make any final pronouncement on any of the above said issues; that it is for the petitioner to raise all those contentions as and when he is given opportunity of hearing prior to the finalisation of the adjudication proceedings pursuant to the detention proceedings referred to in Ext.P7 - However, Court is of the view that the petitioner has made out a strong case by which this Court is persuaded to accept the view that the goods and vehicle detained pursuant to Ext.P7 order could be released to the petitioner on the basis of simple bond and it need not be insisted that the petitioner will have to furnish a bank guarantee for the amounts demanded in Ext.P7 order - The petitioner may take steps to ensure that the details are collected from the local supplier involved in this transaction, which is based in Tamil Nadu, to ascertain whether the said agency has duly filed their returns showing the above said transaction also etc. and if such details are also available, the petitioner may produce those materials also before the 1st respondent, as a matter of abundant caution to convince the 1st respondent that there is no loss of revenue involved in this case etc. -Thereafter, the 1st respondent will afford reasonable opportunity of being heard to the petitioner and then will pass final orders in the adjudication proceedings finalsing the same, without much delay - The entire proceedings in that regard may be duly completed on or before 15.3.2020 - it is ordered that the goods and vehicle detained pursuant to Ext.P7 shall be released forthwith by the 1st respondent to the petitioner, on his executing a simple bond and without insisting on the petitioner furnishing bank guarantee for the demanded value – Petition disposed of: High Court [para 6 to 8]

- Petition disposed of: KERALA HIGH COURT

2020-TIOL-229-HC-KERALA-GST

Sai Lalith Fragrance Vs CST

GST - Petitioner is the proprietrix of an industrial unit in Madras Export Processing Zone which is a notified Special Economic Zone earmarked for 100% export industrial units - The industrial unit of petitioner is manufacturing natural and essential oils, nutraceuticals, oleoresins, food supplements, aromatic chemicals etc. for supply to perfumeries, pharmaceuticals, cosmetics and detergent companies - Petitioner is one of the tenderers in e-auction notice dated 22.5.2018 - The petitioner in the e-auction held on 4.7.2018 and 5.7.2018 is the successful bidder for Lot No.198/18 of 315.00 kgs. of class X sandal wood - On 13.7.2018, the auction was confirmed in favour of petitioner - The petitioner was called upon to comply with the conditions of sale and pay the sale value and taxes - Petitioner, keeping in view its location of business and place of final supply of goods, requested the second respondent to clarifying on payment of IGST at 18% on sale price - Petitioner, de hors clarification, the first and the second respondents insisted upon paying 18% IGST on the goods purchased by the petitioner in the e-auction held on 4.7.2018 as confirmed on 13.7.2018 - Petitioner contends that the demand of IGST is illegal and unauthorised, hence the writ petition.

Held:

+ Following points arise for consideration viz. (a) Whether the supply of goods pursuant to confirmation of sale on 13.07.2018 in favour of petitioner is an inter-State supply or intra-State supply & (b) Whether respondents 1 and 2 are legally justified in levying and demanding 18% IGST on the sale price from the petitioner for completing the sale.

+ Treatment of inter-state and international supplies of goods and services is one of the most crucial elements of the design of a Dual GST regime - The approach under GST regime prescribes a set of rules for defining the place of taxation or place of supply - Now a supply is taxable in a given jurisdiction only if the supply is considered to take place in that jurisdiction - The basic principle behind provisions relating to place of supply is that GST is destination based tax, therefore, tax is finally payable where goods and services are consumed - It is admitted that the supply of goods is to an SEZ Unit - IGST defines what is 'zero-rated tax', and under what circumstances zero-rated tax is applicable and the manner of undertaking transactions with no incidence of tax liability on the recipient - From the above, it is sufficiently clear that the argument of petitioner that it is zero rate tax transaction is completely supported by the combined reading of provisions 5, 7, 8, 10 of the IGST Act - Statute allows movement of goods without payment of tax which is again intended for the special treatment given to SEZ developer or SEZ unit, cannot be frustrated through the factual interpretation based on concluded transaction at Marayoor by the respondents - Hence it is for the parties to the transaction falling under Section 16 of IGST Act to follow one or the other options statutorily provided - It is contextual to observe that exports are priority of any country - The goods and services exported, burden of taxes are not exported with the goods and services exported - The reason is simple i.e., to make the exports internationally competitive and earn foreign exchange to the country - Export incentives are impermissible under WTO, however, goods and services can be relieved from the burden of domestic taxes - Under the scheme of IGST, supplies to SEZ unit and SEZ developer are treated at par with physical exports - The exporting units to compete with world market need raw materials without payment of taxes and duties - Either the denial of zero-rated tax benefit by respondents or calling upon the petitioner to pay 18% tax and claim refund is not in line with statutory scheme - Respondents 1 & 2 by calling upon petitioner to pay 18% IGST are acting contrary to the scheme under IGST - point is answered in favour of the petitioner and against the respondents - The point of law in dispute between the parties is decided by this judgment in favour of petitioner, therefore, there ought not to be further hassles in enabling movement of subject goods from Government Sandal Depot, Marayoor to SEZ - Therefore the conclusion is that the subject supply comes as inter-State movement of goods to SEZ outside the State of Kerala - Held that the subject transaction shall be treated as zero-rated tax supply: High Court [para 8, 14, 21 to 25]

2020-TIOL-219-HC-AHM-GST

Rafik Nasir Ahmed Vs State of Gujarat

GST - The Revenue seized a truck ferrying some goods, belonging to the petitioner - Hence the present writ was filed, seeking the release of both the vehicle as well as the goods in them, as per Section 129(1)(a) of the CGST Act.

Held - It is seen that an SCN in Form GST MOV-10 was issued to the petitioner, proposing to conficate the goods and conveyance for the alleged breach of the provisions of the Act and Rules - Prima facie, it appears that the goods were transported without valid documents - The discrepancies noted by the authorities were incorporated in the Form GST MOV-10 - The petitioner is advised to file an appropriate reply to the SCN and make goods his case that there was no breach of any provisions of the Act or Rules - The present petition cannot be entertained at the stage of SCN - Even if the final order is passed u/s 130 of the Act, the same is appealable u/s 107 of the Act: HC

2020-TIOL-218-HC-PATNA-GST

Micro Info Solution Pvt Ltd Vs State of Bihar

GST - The petitioner filed the present petition, seeking that the order raising duty demand with interest and imposing penalty, be quashed - The petitioner claimed that its claim for transitional credit of SGST u/s 140 of the Act.

Held - It is not disputed that the petitioner has an equally efficacious remedy of filing appeal as per provisions of the Bihar Goods & Service Tax Act 2017 - The petitioner expressed willingness to exhaust such remedy by filing appeal - The issue of limitation will not bar the petitioner, if such appeal is filed on or before 18.02.2020 - The issues raised in this petition are left open: HC

2020-TIOL-217-HC-HP-GST

Bhagwati Construction Company Vs State of Himachal Pradesh

GST - The State Govt of Himachal Pradesh issued e-tender, inviting bids for providing flood protection work - One condition stipulated that the latest Income Tax Clearance Certificate & Sales Tax/GST Clearance Certificate along with copy of PAN and registration under the HP Sales Tax Act 1968 and GST Act, is to be furnished along with the application - The petitioner-company claimed to have submitted its bid and also complied with such condition - Such application was rejected on grounds that the month-wise GST certificate was not furnished - The petitioner filed the present writ, claiming that the necessary documents had been uploaded.

Held - It is worth noting that the prospective bidders are needed to furnish the requisite documents along with tender form in a particular manner as required in the tender notification - When such compliance is made, it is not open to the authorities to reject the applications on grounds of non-compliance of the conditions mentioned - The petitioner can only be expected to comply with the conditions stipulated in the tender notification and in case the respondents require that tender application should be accompanied with month-wise GST Clearance Certificate, then such condition should have been reflected in the tender notification itself - Where such condition is not mentioned in the application, the rejection of the bid is arbitrary and contrary to the tender notification - Hence the order rejecting the application is set aside with directions to the authorities to issue fresh notification highlighting all the documents needed to be furnished: HC

- Writ petition allowed : HIMACHAL PRADESH HIGH COURT

2020-TIOL-209-HC-AHM-GST

Pradip Chimanlal Mevada Vs UoI

GST - Writ applicant has prayed for issuance of writ in the nature of a mandamus or any other appropriate writ, order or direction to the respondent to allow the petitioner to file the form GST ITC-01 in order to claim the input tax credit to which it is entitled as per the provisions of Section 18 of the GST Acts.

Held: Writ application is disposed of with a direction to the Joint Commissioner of State Tax, Mahesana Division, Mahesana to immediately look into the request made by the writ applicant to upload ITC-01 vide representation dated 13th January 2020 and also look into the communication dated 18th October 2019 referred to of the office of the Commissioner, Central GST Gandhinagar - The Joint Commissioner of State Tax is, accordingly, directed to take an appropriate decision in this regard and communicate the same to the writ applicant within two weeks - Application disposed of: High Court [para 4, 5]

- Writ Application disposed of: GUJARAT HIGH COURT

2020-TIOL-206-HC-DEL-GST

Pitambra Books Pvt Ltd Vs UoI

GST - Petition inter-alia impugns Circular No.37/11/2018 - GST dated 15.03.2018 and Circular No. 125/44/19 -GST dated 18.11.2019 - Petitioner submits that owing to the restrictions imposed in the aforenoted circulars, Petitioner has been deprived of the benefit of availing refund claim of the unutilised input tax credit for the period from April, 2018 to June, 2018 and this is causing serious financial hardship as more than Rs.30 crores of accrued and unutilised input tax credit, that is eligible for refund is now lying stuck; that paragraph 8 of impugned circular no. 125/44/2013/GST dated 18th November, 2019, inhibits refund claims for a period of two separate (not successive) financial years and which is in contravention of Section 44 as also Rule 89 of the IGST rules.

Held: Bench is of the prima facie view that by way of the impugned circulars, though the respondents recognise the difficulties faced by the exporters and have permitted them to file refund claim for one calendar month/quarter or by clubbing successive calendar months/quarters, yet the restriction pertaining to the spread of refund claim across different financial years is arbitrary - There is no rationale or justification for such a constraint - where exports are not made in the same financial year, question arises as to whether Respondents can restrict the filing of the refund for tax periods spread across two financial years and deprive the petitioner of its valuable right accrued in his favour - In exports, availability of the rotation of funds is essential for the business to thrive - Moreover, businesses do not run according to the whims of the executive authorities - The business world cannot be told when to place orders for exports; when to manufacture the goods for export; and; when to actually undertake the exports - Respondents' impugned circulars have thus blocked the capital of the petitioner and the unutilised ITC and it has accumulated huge amount of unutilised ITC to the tune of Rs.30 crores - Merely because the petitioner made exports in the month of June, 2018, we do not see any justification to deny the refund of the ITC which have accumulated in the previous financial years - The entire concept of refund of ITC relating to zero rated supply would be obliterated in case the respondents are permitted to put any limitation and condition that takes away petitioner's right to claim refund of all the taxes paid on the domestic purchases used for the purpose of zero rated supplies - The incentive given to the exporters would lose its meaning and this would cause grave hardship to the exporters who are earning valuable foreign exchange for the country - The Respondents cannot, artificially by acting contrary to the fundamental spirit and object of the law, contrive ways to deny the benefit, which the substantive provisions of the law confer on the taxpayers - In the considered opinion of the Bench, the petitioner has a strong prima facie case, and it cannot deny the petitioner of its right to claim refund which is visible from the mechanism provided under the Act - The impugned circulars take away the vested right of the taxpayer that has accrued in the relevant period - till the next date of hearing, Bench stays the rigour of paragraph 8 of Circular No. 125/44/2019-GST dated 18.11.2019 and also directs the Respondents to either open the online portal so as to enable the petitioner to file the tax refund electronically, or to accept the same manually within 4 weeks - Respondents are directed to process the petitioner's claim in accordance with law: High Court [para 12 to 14]

- Petition disposed of: DELHI HIGH COURT

2020-TIOL-205-HC-AHM-GST

Sakir Jamaluddin Vs State of Gujarat

GST - Writ applicant inter alia seeks release of seized goods along with the truck.

Held: SCN in Form GST MOV-10 dated 5th October, 2019 has been issued by the Office of the Deputy State Tax Commissioner, Mehsana, calling upon the writ applicant to show-cause as to why the goods and the conveyance should not be confiscated for the alleged breach of the provisions of the Act and the Rules - Prima facie, it appears that the goods were being transported without any valid documents - The discrepancies noticed by the authority have been incorporated in the Form GST MOV-10 - Bench is of the view that the writ applicant should file an appropriate reply to the show-cause notice and make good his case that there is no breach of any of the provisions of the Act or the Rules - Bench is not inclined to entertain this writ application at the stage of show-cause notice - Ultimately, even if the final order is passed under Section 130 of the Act, the same is appealable under Section 107 of the Act - writ application disposed of: High Court [para 3, 4]

- Application disposed of: GUJARAT HIGH COURT

2020-TIOL-204-HC-AHM-GST

Kwality Makers Snacks Pvt Ltd Vs State of Gujarat

GST - Writ applicant seeks to challenge the show-cause notice in FORM-GST MOV-10 of the CGST Act, 2017 calling upon him to show cause as to why the goods and the conveyance should not be confiscated for the alleged contravention of the provisions of the Act and the Rules.

Held: Bench is not inclined to interfere at this stage since if a final order of confiscation is passed, same is appealable u/s 107 of the Act - nonetheless, it is open to the writ applicant to to prefer an appropriate application under the provisions of s.67(6) of the Act seeking provisional release of the goods and conveyance pending confiscation proceedings and if such applciation is filed, the authority concerned to decide it expeditiously - Matter stands disposed of: High Court [para 3, 4]

- Application disposed of: GUJARAT HIGH COURT

2020-TIOL-203-HC-AHM-GST

Essar Power Gujarat Ltd Vs UoI

GST - Petitioner prays for quashing the notification 8/2017-ITR and Entry no. 10 to 10/2017-ITR by declaring that the same lacks legislative competency and is ultra vires the IGST Act and hence unconstitutional; that no tax is leviable under the IGST Act on ocean freight for services supplied by a person located in non taxable territory by way of transportation of goods by a vessel from a place outside India up to the customs station of clearance in India and levy and collection of tax on such ocean freight under the impugned Notification is not permissible under the law etc.

Held: By judgement and order dated 23rd January 2020 [ 2020-TIOL-164-HC-AHM-GST ] passed by this Court in the Special Civil Application No.726 of 2018 and allied matters, Court declared the Notification No. 8/2017 - Integrated Tax (Rate) dated 28th June 2017 and the Entry 10 of the Notification No. 10/2017 - Integrated Tax (Rate) dated 28th June 2017 as ultra vires the Integrated Goods and Services Tax Act, 2017 on the ground of lack legislative competency - In such circumstances, this petition need not be now adjudicated any further - same is disposed of: High Court [para 2, 3]

- Petition disposed of: GUJARAT HIGH COURT

2020-TIOL-199-HC-MAD-GST

Ideal Movers Pvt Ltd Vs State Tax Officer

GST - Petitioner is a transporter and had been engaged to transport a consignment by Essar Steel India Limited (consignor) from Kancheepuram District to one Neel Metal Products Ltd. (consignee) situated at Krishnagiri District - Consignment was accompanied by invoices - An e-way bill had been generated on 12.01.2020 at 7:23 p.m., valid till 16.01.2020 - However, the lorry had broken down on 13.01.2020 with major gear box damage near Vellore and was thus lying in Vellore at one Lawrence Automotive Private Limited, who vide certificate dated 16.01.2020 confirmed this position and also stated that the delay in carrying out the repair was on account of the intervening Pongal holidays - After repair, the lorry proceeded to deliver the goods to the destination, however, accompanied by the e-way bill that had expired/lapsed on 16.01.2020 itself. The lorry was intercepted at Vellore and detained for non-possession of valid e-way bill - Petitioner was issued with a notice in terms of s.129(3) of the CGST Act on 17.01.2020 and served on the lorry driver.

Held: What remains is the question of quantifying the remittance required, conditional upon which, the goods are liable to be released - Section 129 is a complete code for the purpose of addressing all violations committed in transit leading to detention, seizure and release of goods and brings within its sweep all such contraventions, irrespective of the gravity of the violation itself - since clauses (a) and (b) of sub-section (1) commence with the phrase on payment, it is not sufficient for the consignor to merely make an offer or undertake to remit the tax as in the present case, but actually remit the payment - s.129(1)(b) deals with a situation where the owner of the goods has not come forward to pay the tax and penalty, thus necessitating the transporter to pay applicable tax, in addition to penalty equal to 50% of the value of the goods, reduced by the tax paid - second proviso under Rule 138(10) permits a transporter to extend the validity of the expired e-way after updating the details in the relevant Form and this benefit would be available in a case such as the present - In fine, the amount to be remitted would, in terms of Section 129(1)(b), be Rs.86,700/- each towards CGST and SGST - As for penalty, the petitioner enjoys the benefit of Circular no.10 of 2019 dated 31.05.2019 where at para 10, the Commissioner reduces the penalty payable in certain circumstances to Rs.5000/- - Thus upon remittance of the taxes of a sum of Rs.86,700/- each towards Central and State Taxes and penalty of Rs.5000/-, the consignment shall be released forthwith - Petition disposed of in aforesaid terms: High Court [para 6, 8, 9]

- Petition disposed of: MADRAS HIGH COURT

2020-TIOL-198-HC-KERALA-GST

Shajahan A M Vs ASST STO

GST - Petitions filed seeking a writ for quashing the notices issued by the respondent demanding GST and for imposition of penalty and also seeking a direction to the respondent to release the vehicle with goods without insisting for payment of amount demanded.

Held: Upon a careful evaluation of the facts and circumstances of the case, it is ordered that the detained goods and vehicles involved in these two cases as per the impugned proceedings shall be immediately released to the petitioner on his furnishing Bank Guarantee for the respective values of demand - 2nd respondent adjudication officer will ensure that the further proceedings pursuant thereto, be adjudicated and finalised after affording reasonable opportunity of being heard to the petitioner without much delay, preferably within a period of 3 to 4 weeks - 2nd respondent should also consider the specific plea made by the petitioner that, even otherwise the maximum tax that could be imposed in a case like this could be 12% and not at the rate of 28% as has been ordered in the impugned proceedings since it is admitted by none other than the 1st respondent in the impugned proceedings that the detained motor cycles are 'used vehicles' and not 'brand new vehicles' and, therefore, the tax imposable could be only at the rate of 12% as per the notification dated 25.1.2018 - said plea of the petitioner should be duly adverted to and considered by the 2nd respondent while passing orders for the finalization of abovesaid proceedings - Petitions disposed of: High Court [para 4 to 6]

- Petitions disposed of: KERALA HIGH COURT

2020-TIOL-192-HC-MAD-GST

ASST CCGST & CE Vs Sutherland Global Services Pvt Ltd

GST - Single Judge had while allowing the petition filed by the assessee held that i n the absence of any lapsing provision, balance of EC/SHEC/KKC as on 30.06.2017 is also eligible to be carried forwarded as transitional credit; that the  addition of Explanation 3 to Section 140 cannot have the effect of denying such transitioning of EC/SHEC/KKC balance; that  in case of service providers having centralised registration, additionally under Section 140 (8) also such EC/SHEC/KKC balance can be carried forwarded; that the letter dated 14.02.2018 issued by  the  assessing officer asking the petitioner to reverse the amount of Rs.1,03,08,706/- on the ground that s.140 of the CGST Act read with rule 117 of the CGST Rules does not cover the Cesses such as Education Cess, Secondary and Higher Education Cess and Krishi Kalyan Cess, was quashed and set aside - Revenue has filed a Writ appeal against the said order, cites the Delhi High Court decision in Cellular Operators Association of India [ 2018-TIOL-310-HC-DEL-ST ] whereas the respondent relied upon the apex court decision in  Eicher Motors Ltd. [ 2002-TIOL-149-SC-CX-LB ]

Held: In the facts and circumstances of the case, Bench considers it appropriate to stay the operation of the order of the Single Judge as it is likely to be applied in other such similar cases - Matter to be posted after six weeks: High Court [para 6]

- Stay granted: MADRAS HIGH COURT

2020-TIOL-186-HC-MAD-GST

Beauty Wares Vs ACCT & CE

GST - Petitioner has filed the writ petition for a mandamus to permit him to avail credit on the closing stock of input footwear available by rectifying Trans-1 filed by them earlier - petitioner submits that they have been sending representations to the authorities concerned but without any response, hence the petition.

Held: Petitioner is given liberty to make appropriate representation to the Nodal officer namely Principal Commissioner of GST at Nungambakkam, citing the decisions in Adfert Technologies Pvt. Ltd. 2019-TIOL-2519-HC-P&H-GST , Lease Plan India Pvt Ltd. 2019-TIOL-2164-HC-DEL-GST and Blue Bird Pure Pvt. Ltd. 2019-TIOL-1564-HC-DEL-GST - If such application is made, the said Nodal officer is required to consider and pass appropriate orders within a period of 30 days after hearing the petitioner - Petition disposed of: High Court [para 4]

- Petition disposed of: MADRAS HIGH COURT

AAAR CASES

2020-TIOL-09-AAAR-GST

Rotary Club of Mumbai Queens Necklace

GST - AAR had held that  Membership subscription and admission fees collected from members is liable to GST as supply of service; that  ITC of tax paid on Banquet and catering services for holding member meetings and various events is not admissible since the applicant has not satisfied the proviso to section 17(5)(b)(i) of the CGST Act, 2017- Appeal to AAAR.

Held: On perusal of the financial statements and going through the submissions, it is  observed that the appellant is not providing any specific facility or benefits to its members against the membership subscription charged by it as the entire subscription amount is spent towards meetings and administrative expenditures only - Appellant is, therefore, not doing any “business” as envisaged u/s 2(17) of the CGST Act, 2017 - In view thereof, it can be deduced that the activities carried out by the appellant would not come under the scope of 'supply' as envisaged u/s 7(1) of the Act, 2017 - Consequently, question regarding availment of ITC on the input services like catering services, banquet services etc. does not arise: AAAR

GST - If the Appellate Authority holds that the activities of the appellant are a 'supply' then the membership fee collected by the appellant, which is purely in the nature of reimbursement for the meetings and the administrative expenditure incurred by the appellant to sustain and propagate their inherent programs would be subject to 'double taxation' as the amount spent towards the meetings and the administrative expenditures is already subjected to GST at the hands of the suppliers of these input services or goods - doing so would clearly be against the legislature's intention of the formulation of GST, which certainly does not embrace the idea of double taxation - Order of AAR set aside and appeal allowed: AAAR

- Appeal allowed: AAAR

 

AAR CASES

2020-TIOL-24-AAR-GST

Awas Bandhu

GST - Applicant seeks to know as to whether the activity of printing of question papers on behalf of educational institutions can be classified as activity of supply of goods or supply of services; whether, if held as services, same is entitled for the benefit of 11/2017-CTR, Sr. no. 27, 12/2017-CTR, Sr. no. 66; whether, if held as goods, then question paper should be treated as exempted goods CSH 4901 1010 or under Notification 1/2017-CTR, Schedule I, Sl. No. 201 and liable @2.5% CGST as ‘brochures, leaflets and similar printed matter, whether or not in single sheets'. Held: Question Papers are not the property of the Applicant - Furthermore, the Question Papers supplied by the Applicant to their customers are not marketable commodities in the open market and as goods they have no legitimate value to persons other than the specific customer who provides the input content - The Applicant, therefore, cannot be said to be supplying Question Papers as "goods" under the GST Act, but to be supplying the service of printing: AAR Held: Activity of printing of question papers by the applicant is activity of supply of services classifiable under Heading 9989; benefit of Sr. No. 66 of Notification No. 12/2017 -Central Tax (Rate) is admissible only in case where service is provided to an educational institution and if provided to other than 'educational institutions' will be covered by Sr. No. 27(i) of Notification No. 11/2017 -CTR and will attract GST @ 12%: AAR

- Application rejected: AAR

2020-TIOL-23-AAR-GST

Maxwell Company Pvt Ltd

GST - Applicant seeks to know as to whether the activity of printing of question papers on behalf of educational institutions can be classified as activity of supply of goods or supply of services; whether, if held as services, same is entitled for the benefit of 11/2017-CTR, Sr. no. 27, 12/2017-CTR, Sr. no. 66; whether, if held as goods, then question paper should be treated as exempted goods CSH 4901 1010 or under Notification 1/2017-CTR, Schedule I, Sl. No. 201 and liable @2.5% CGST as ‘brochures, leaflets and similar printed matter, whether or not in single sheets'. Held: Question Papers are not the property of the Applicant - Furthermore, the Question Papers supplied by the Applicant to their customers are not marketable commodities in the open market and as goods they have no legitimate value to persons other than the specific customer who provides the input content - The Applicant, therefore, cannot be said to be supplying Question Papers as "goods" under the GST Act, but to be supplying the service of printing: AAR Held: Activity of printing of question papers by the applicant is activity of supply of services classifiable under Heading 9989; benefit of Sr. No. 66 of Notification No. 12/2017 -Central Tax (Rate) is admissible only in case where service is provided to an educational institution and if provided to other than 'educational institutions' will be covered by Sr. No. 27(i) of Notification No. 11/2017 -CTR and will attract GST @ 12%: AAR

- Application disposed of: AAR

2020-TIOL-22-AAR-GST

Rajeev Kumar Garg

GST - Supply of Food items at GMUs (General Minor Units) at railway platforms which includes only counter sale of packed food items, drinks and cooked item shall be treated as 'Supply of Services' - Whole revenue shall be taxed @ 5% without ITC under Serial No. 7(ia) of Notification No. 11/2017- Central Tax (Rate) , dated 28-6-2017 - Applicant cannot claim the Input Tax Credit of GST paid on license fees to Indian Railway or IRCTC: AAR

- Application disposed of: AAR

CGST RULES NOTIFICATIONS

07/2020

Govt notifies due dates for filing Form GSTR-3B by assessees having aggregate turnover of up to Rs 5 crores in previous FY

06/2020

Seeks to extend the last date for furnishing of annual return/reconciliation statement in FORM GSTR-9/FORM GSTR-9C for the period from 01.07.2017 to 31.03.2018.

 

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