2023-TIOL-168-SC-GST
Asstt. CST Vs Suncraft Energy Pvt Ltd
GST - In the show cause notice it was alleged that the fourth respondent has not shown the Bill in GSTR-1 and hence the appellant is not eligible to avail the credit of the input tax as per s.16(2) of the Act, 2017 as the tax charged in respect of such supply has not been actually paid to the Government - In the intra-court appeal, the Division Bench of Calcutta High Court observed that the first respondent had not conducted any enquiry on the fourth respondent supplier more particularly when clarification had been issued where furnishing of outward details in Form GSTR-1 by a corresponding supplier and the facility to view the same in Form GSTR-2A by the recipient is in the nature of taxpayer facilitation and does not impact the ability of the taxpayers to avail input tax credit - Court further held that the first respondent, without resorting to any action against the fourth respondent who is the selling dealer, has ignored the tax invoices produced by the appellant as well as the bank statement to substantiate that they have paid the price for the goods and services rendered as well as the tax payable thereon and, therefore, the action of the first respondent has to be branded as arbitrary - Order reversing the ITC was set aside with a direction to the appropriate authorities to first proceed against the fourth respondent - Aggrieved, the Assistant Commissioner, State Tax filed a SLP before the Supreme Court.
Held: Delay condoned - Having regard to the facts and circumstances of this case(s) and the extent of demand being on the lower side, Bench is not inclined to interfere in these matters in exercise of its powers under Article 136 of the Constitution of India - Special Leave Petitions are dismissed: Supreme Court
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Petitions dismissed: SUPREME COURT OF INDIA
2023-TIOL-1711-HC-ALL-GST
Royal Enterprises Vs UoI
GST - Maintainability - Appellate tribunal has not been made functional till date - Right of second appeal is being denied on account of failure of Government - The executive inertia cannot become the cause of denial of a statutory right: High Court
GST - Short controversy which arises is the inconsistency of some interim orders passed by this Court as regards the amount of pre-deposit - One line of interim orders contemplates deposit of 30% of the amount out of which 10% which is deposited before the first appellate authority is liable to be adjusted - However, there seems to be another view wherein 50% of the disputed tax amount was directed to be deposited before granting interim protection.
Held: In congruent facts, identical interim orders are liable to be granted, otherwise an anomalous situation will be created where similarly situated persons will be accorded differential treatment leading to discrimination and violation of Article 14 of the Constitution of India - The second aspect which requires to be given weight is that the assessee cannot be faulted for what is essentially a failure of the Government - The statute contemplates deposit of 10% plus 20% of the disputed tax liability before the first and second appellate authorities respectively - By imposing a demand of 50% in these matters, the assessees will be penalized for no fault of theirs - Applications for interim relief are finally disposed of with the following directions - The petitioner shall deposit 20% of the disputed tax liability in addition to the earlier deposit before the assessing authority (which is 10% of the disputed tax amount) - Subject to the aforesaid deposit, the recovery proceedings of the balance amount shall remain stayed till the decision of this writ petition: High Court
- Interim order passed: ALLAHABAD HIGH COURT
2023-TIOL-1710-HC-ALL-GST
N G Enterprises Vs State of UP
GST - Maintainability - Appellate tribunal has not been made functional till date - Right of second appeal is being denied on account of failure of Government - The executive inertia cannot become the cause of denial of a statutory right: High Court
GST - Short controversy which arises is the inconsistency of some interim orders passed by this Court as regards the amount of pre-deposit - One line of interim orders contemplates deposit of 30% of the amount out of which 10% which is deposited before the first appellate authority is liable to be adjusted - However, there seems to be another view wherein 50% of the disputed tax amount was directed to be deposited before granting interim protection.
Held: In congruent facts, identical interim orders are liable to be granted, otherwise an anomalous situation will be created where similarly situated persons will be accorded differential treatment leading to discrimination and violation of Article 14 of the Constitution of India - The second aspect which requires to be given weight is that the assessee cannot be faulted for what is essentially a failure of the Government - The statute contemplates deposit of 10% plus 20% of the disputed tax liability before the first and second appellate authorities respectively - By imposing a demand of 50% in these matters, the assessees will be penalized for no fault of theirs - Applications for interim relief are finally disposed of with the following directions - The petitioner shall deposit 20% of the disputed tax liability in addition to the earlier deposit before the assessing authority (which is 10% of the disputed tax amount) - Subject to the aforesaid deposit, the recovery proceedings of the balance amount shall remain stayed till the decision of this writ petition: High Court
- Interim order passed: ALLAHABAD HIGH COURT
2023-TIOL-1709-HC-MUM-GST
Nemi Pharma Chem Vs Addl. CCGST & CX
GST - On 12th April 2023, a show cause notice was issued by the Respondents to the Petitioner and various other persons - On 26th June 2023, the Petitioner's authorised representative filed a letter requesting the Respondents to provide a copy of the show cause notice dated 12th April 2023, since the address at which it was issued was no more occupied by the Petitioner - The petitioner came to know about the SCN from the suppliers and, therefore, addressed such a letter - They also requested an adjournment for 30 days so as to enable them to make submissions and for personal hearing - Respondents handed over a copy and an order came to be passed on 21st July 2023 in form GST DRC-07 raising a demand of Rs.20.87 crores and a penalty of Rs.18.17 crores - Petitioner has challenged this order - Petitioner submits that there is gross violation of the principles of natural justice and, therefore, seeks quashing the order and for a personal hearing to be granted and a fresh order be issued - Counsel for respondent submits that the petitioner has not informed the department about the change of address; that the order is an appealable one and, therefore, the petitioner should be relegated to alternate remedy; that the present petition is filed to avoid payment of pre-deposit.
Held: Admittedly, there is no rejection in writing to the request made by the Petitioner vide letter dated 26th June 2023 seeking 30 days time for making submissions and for personal hearing - The impugned order came to be passed within two weeks from the date of application for adjournment without the Respondents replying to the request for adjournment of the Petitioner - Respondents ought to have also complied with the provisions of Section 75(4) which provides that an opportunity of a hearing shall be granted, when a request is received in writing from the person chargeable with tax or penalty or where any adverse decision is contemplated against such person - Since, in the instant case, there has been a violation of principles of natural justice and the mandatory provision of Section 75(4) of the CGST Act, the Court is inclined to entertain the present petition under Article 226 of the Constitution of India and quash the impugned order dated 21 st July 2023 - Petitioner is directed to file written submissions by 18 January 2024; and appear for a personal hearing on 25 January 2024 - Respondents to pass speaking order on or before 28 February 2024 - Petition disposed of: High Court [para 6]
- Petition disposed of: BOMBAY HIGH COURT
2023-TIOL-1708-HC-AP-GST
New Morning Star Travels Vs Deputy Commissioner ST
GST - Challenge is to the order dated 31.03.2022 - Main thrust of the argument is that no SCN was issued in terms of rule 142(1A) of the Rules in Part A of Form GST DRC-01A - It is argued, in the said provision, which stood before amendment with effect from 15.10.2020, the word ‘shall' is employed and, therefore, issuance of communication before the service of notice under Section 74(1) is mandatory in terms of Rule 142 (1A) of the CGST Rules - Counsel for Revenue submitted that Rule 142(1A) of CGST Rules, 2017 was amended with effect from 15.10.2020 and whereby in Rule (1A), for the words ‘proper officer shall', the ‘proper officer may' has been substituted and in that view, the issuance of intimation under Rule 142(1A) is only a discretion on the part of the concerned authority, but not mandatory.
Held : Point for consideration is, whether the impugned assessment order, dated 31.03.2022, passed by the 1st respondent is invalid for the reason that show cause notice dt.05.11.2021 was issued straight away, without issuing a prior intimation under Rule 142 (1A) of CGST Rules, 2017 - It is a trite law that whenever any ambiguity arises with regard to any provision, the benefit must go to the taxpayer - In the instant case, since admittedly the tax period related to 01.07.2017 to 31.03.2021 which covers the pre and post amended period of Rule 142(1A), in the considered view of the Bench, the 1st respondent ought to have issued tax intimation to the petitioner under Rule 142(1A) - Since it was not done, as rightly argued, the assessment order, dated 31.03.2022, fell foul of law and is liable to be set aside - Accordingly, the writ petition is allowed and the impugned assessment order, dated 31.03.2022, passed by the 1st respondent is set aside with a direction to the 1st respondent to issue a fresh tax intimation to the petitioner in terms of Rule 142(1A) (pre amended Rule 142 (1A)) within two weeks - Petition allowed: High Court [para 8, 17, 18]
- Petition allowed: ANDHRA PRADESH HIGH COURT
2023-TIOL-1707-HC-DEL-GST
Bhagat Ram Om Prakash Agro Pvt Ltd Vs CCT GST Delhi
GST - A search under Section 67(1) of the CGST Act was conducted at the premises of the petitioners on 22.08.2023 - Petitioners pray that the records of the search authorisation be recalled and the same be quashed; that the documents etc. which were collected during the search/inspection be returned.
Held: Bench has perused the original file and observes that the inspection was conducted pursuant to the order dated 05.04.2023 passed by the Special Judge (P.C. Act) Special Judge who had directed the Income Tax Department, GST Department and Enforcement Directorate to check the source of Rs. 50,00,000/- received by the petitioners - However, record does not indicate that any further investigation was conducted prior to authorizing the inspection under Section 67(1) of the CGST Act - A perusal of the said authorization indicates that all grounds as stated in Clause 'A' of the FORM GST INS-01 were recorded as reasons for authorizing the inspection - It is clear from the record that apart from the directions issued in terms of the order dated 05.04.2023, there were no reasons for the respondent to initiate the search against the petitioners under Section 67(1) of the CGST Act - Bench has serious reservations as to whether any such directions could have been issued by the Special Judge for conducting a roving and fishing inquiry by the GST authority - Clearly, since the conditions for inspection under Section 67(1) of the CGST Act were not satisfied, the said documents are required to be returned to the petitioners - It is so directed - Insofar as the summons issued under Section 70 of the CGST Act are concerned, Bench does not consider it apposite to issue any directions - The GST authorities are not precluded from continuing or initiating proceedings in accordance with the provisions of the CGST Act - Petition disposed of: High Court [para 3, 6, 7, 8, 9, 11, 12]
- Petition disposed of: DELHI HIGH COURT |
