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2023-TIOL-1586-HC-DEL-GST
Association of Technical Textiles Manufacturers And Processors Vs UoI
GST - Petitioner seeks quashing of paragraphs 7.1, 7.2, 7.3 and 7.4 of the Circular No. 80/54/2018-GST dated 31.12.2018 to the extent that it purports to clarify that polypropylene woven and non-woven bags including those laminated with Biaxially Oriented Polypropylene are liable to be classified as falling under Chapter 39 and more particularly Tariff Heading 3923 forming part of the First Schedule to the Customs Tariff Act, 1975 - Petitioners are aggrieved by the aforesaid Circular, since it contends that polypropylene woven or non-woven bags are made out of textiles [Chapter 56] and thus cannot be equated with plastics.
Held: While both the petitioners as well as the respondents have sought to draw sustenance from various decisions rendered either by the AAR or the AAAR, they were neither cited nor placed before Bench for its consideration - Bench, therefore, desists from rendering any observation or comment on the correctness or otherwise of the opinions so rendered - In the absence of a conferral of any power upon the TRU, or it being recognized as being statutorily enabled to issue any clarification or directive under Section 168 of the CGST Act, the circular is liable to be quashed and set aside on this ground alone - Bench is constrained to observe that divergent or contrary views that may be taken by the appropriate AARs' or AAARs' cannot be rendered a quietus by the issuance of a directive or clarification of the nature which was impugned - A reading of the impugned circular would establish that it fails to examine the issue on the anvil of the distinction which the 1975 Act appears to construct when it places plastics under Chapter 39 and textiles and articles thereof separately in Section XI, and more particularly, as was contended by the petitioners in Chapters 56 and 63 of the said enactment - The impugned circular also fails to advert to the Notes placed in Chapter 39, and which, in unambiguous terms, exclude textiles from the ambit thereof - For the aforenoted additional reasons, we find ourselves unable to uphold the impugned circular - The failure of parties to address the question comprehensively constrains the Bench to desist from rendering a definitive opinion in that respect bearing in mind the industry wide ramifications that may ensue - Courts should avoid expressing an opinion on questions of classification unless they are directly raised and adequate and cogent material placed on the record - Bearing in mind the impact that such a ruling may have, findings in that respect, in any case, should not be founded on material which is tenuous and inadequate - Bench is further of the view that since the writ petition itself stood restricted to the validity of the circular, it would be imprudent for it to hand down a verdict imbued with attributes of finality - Bench is of the considered opinion that the issue of classification should be left open for the consideration of the competent authority in appropriate proceedings - Writ petition stands allowed - The impugned circular dated 31 December 2018 is hereby quashed: High Court [para 18, 23, 25, 26, 27, 28, 29]
- Petition allowed: DELHI HIGH COURT
2023-TIOL-1585-HC-P&H-GST
Deepak Sales Corporation Vs UoI
GST - ITC - There is no dispute between the parties about the fact that during the month of August 2017, the petitioner was entitled to take ITC of Rs.1,40,57,836/- and had claimed an amount of Rs. 14,05,78,663/- instead of the abovesaid amount - Meaning thereby, that it had taken excess ITC to the tune of Rs. 12,65,20,827/- in its return of the said month - It is also not in dispute that the petitioner had reversed the amount so taken in excess as on 18.08.2018 and the same was duly reflected in its GSTR-3B return for that month - The main question that arises for consideration is as to whether the petitioner was proved to have utilized an amount of Rs. 21,13,354/- out of the amount which was entered out of the excess ITC amount to the tune of Rs. 12,65,20,827/- in its electronic credit ledger as observed by respondent No. 4 - From a purposeful reading of the provisions underlying Section 50 of the CGST Act, the legislation intent that stands reflected is that where an ITC/CENVAT credit is wrongfully reflected in electronic ledger, the same itself is not sufficient to draw penal proceedings until the same or any part of such ITC is put to use so as to become recoverable and if such CENVAT credit is reversed before utilization, then even the demand of interest and penalty cannot be said to be tenable - Balance of ITC available in the electronic credit ledger of the petitioner was never below the sum of Rs. 12,65,20,827/- which shows that till August 2018 when the petitioner reversed the excess ITC amount, it had never utilized the same - This fact had obviously been wrongly overlooked by respondent No. 4 and once it was proved that the amount of excess ITC though entered in the ledger in excess, was never utilized by the petitioner and since it was reversed prior to utilizing, therefore, in the considered opinion of the Bench, in view of the ratio of law as laid down in Jagatjit Industries Ltd.'s case ( 2011 (22) S.T.R. 518 (P&H) ), Grasim Bhiwani Textile Ltd.'s case ( 2018-TIOL-1074-HC-P&H-CX ) & M/s Commercial Steel Engineering Corporation's case ( 2019-TIOL-1585-HC-PATNA-GST ), the demand of interest as well as penalty was not at all tenable and the petitioner could not be burdened with the same - It is held that the petitioner was not liable to pay the amount of interest or penalty on the excess ITC wrongly entered by it in its electronic credit ledger for the relevant period - Accordingly, the appeal is allowed: High Court [para 10 to 12]
- Appeal allowed: PUNJAB AND HARYANA HIGH COURT
2023-TIOL-1584-HC-MAD-ST
RR Housing India Pvt Ltd Vs Designated Committee (SVLDRS)
ST - Petitioner prays for a direction to the first respondent to consider the payment made by the petitioner dated 1.3.2021 as payment under SVLDRS Scheme and also direct the first respondent to issue discharge certificate in form SVLDRS 4 - Government, considering the pandemic situation, has extended the time limit for making payment under the Scheme up to 30.06.2020, however, the petitioner could not pay the tax dues on or before 30.06.2020 due to financial crisis faced - Petitioner, vide letter dated 30.6.2020 requested the Superintendent, SVLDRS Section to grant some more time to make payment of Rs.14,98,835.20 since they are facing major financial crunch due to pandemic and lock down - However, the second respondent vide impugned proceedings dated 2.3.2021, directed the petitioner to pay the entire arrears confirmed vide Order-in-Original dated 22.11.2019 - Counsel for Revenue submitted that though the intimation in Form SVLDRS 3 was issued on 13.02.2020, the demanded tax amount was paid only on 01.03.2021, which is beyond the prescribed time limit, therefore, they are not in a position to issue Form SVLDRS 4 to the petitioner.
Held : There is no doubt that the provision of fixing time limit under the SVLDRS Scheme is directory in nature and that is the reason why the Department had extended the time limit for payment of tax amount under the SVLDRS Scheme by virtue of notifications - When that being the case, the Department is supposed to have extended the time at par with the order passed by the Supreme Court [ 2022-TIOL-04-SC-MISC-LB ], where it had considered the difficulties faced by the public in mobilizing the money, filing the cases before the Courts, etc., and granted the time limit up to 28.02.2022 - However, though the respondent-Department had considered and issued the notifications on 3 occasions, thereafter, they had neither considered the difficulties faced by the Assessee nor issued any notifications extending the time limit for making payment of tax under the scheme - Court is of the view that the amount, which was paid by the petitioner on 02.03.2021 shall be consider as the amount paid under the SVLDRS Scheme and hence, the Department is bound to issue the Form SVLDRS-4 [within a period of 30 days] with regard to the discharge of liabilities - Writ Petition is allowed - The respondents are directed to accept the payment of Rs.14,98,836/- made by the petitioner under SVLDRS-3 on 01.03.2021 - The petitioner is directed to pay interest at 15% p.a. on 14,98,836/- from 01.07.2020 till the date of payment, within a period of four weeks: High Court [para 18, 20, 22]
- Petition allowed: MADRAS HIGH COURT
2023-TIOL-1583-HC-AHM-CUS
HRMM Agro Overseas Pvt Ltd Vs UoI
Cus - The petitioner submitted that after issuance of notice by this Court, a Circular No. F.No. 450/195/2022-Cus-IV was issued, clarifying the notfn 49/2023 - Customs, by which it is clarified that there was no issue in holding that export duty of 20% on exports of Parboiled Rice, falling under tariff item 1006 30 10, has come into effect on 25th August, 2023, and accordingly, wherever the goods have entered for export under Section 50 of Customs Act, 1962, prior to 22:49:08 on 25th August, 2023, the notification would not be applicable - In view of said clarification, petition would not survive and interim relief granted by this Court for furnishing the bond and amount of duty with revenue also stands vacated: HC
- Petition dismissed: GUJARAT HIGH COURT |
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