Calcutta HC quashes order under West Bengal GST for violation of Natural Justice Principle [Read Order]

The High Court of Calcutta quashed an order under West Bengal Goods and Service Tax (GST) for violation of the Natural Justice Principle.

M/s. Gayatri Projects Limited, the petitioner challenged the order by which the Single Bench declined to grant any interim order till the disposal of the writ petition and directed affidavits to be filed.

Mr Ankit Kanodia, Advocate appeared for the appellants, Mr Debasish Ghosh, Government Advocate appeared for the State and Mr Rajeev Agarwal, Advocate appeared for respondent No: 4.

The order impugned in the writ petition was passed by the West Bengal Authority for Advance Ruling Goods and Services Tax, Kolkata where it was held that the applicant, namely, Eastern Coalfields Limited, the 4th respondent, is not entitled to input tax credit claimed by them on the invoices raised by the appellants about the period January 2020, February 2020 and March 2020 for which the supplier had furnished Form GSTR 1 and GSTR 3B in the month of November 2020.

The respondent / Eastern Coalfields Limited was required to reverse the said input tax credit. Though the input tax credit claimed by the 4th respondent pertained to the invoices raised by the appellants, the appellants were not heard by the authority as they were not made parties to the said application.

It was contended by the appellant that the non-payment of the GST amount charged by the 4th respondent to the appellants is violative of Article 19(1)(g) and 300A of the Constitution of India and against the provisions of the CGST and WBGST Act, 2017.

Further contended that the authority’s decision has been made with the finding of fact that excess credit had been availed without determining the credit available based on uploaded invoices; 10% statutory limit to be computed thereon to avail credit in respect of invoices not uploaded;

The Court viewed that the appellants cannot be non-suited by an order, which was passed by the authority without hearing them. Further observed that since the appellants have contended that sufficient factual details were not placed before the authority, directing the appellants to prefer an appeal to the appellate authority may not be effective since the facts, which the appellants seek to bring on record was not part of the records before the original authority.

A two-member Bench comprising Justice T S Sivagnanam and Justice Hiranmay Bhattacharyya observed that the matter has to be re-examined by the authority themselves instead of directing the appellants to approach the appellate authority.

The Court allowed the writ petition by setting aside the impugned order and the matter was remanded back to the 5th respondent for fresh consideration.

To Read the full text of the Order CLICK HERE

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