GST Case Digest Series: High Court Tax Cases, 2020
GST is known as the Goods and Services Tax which is an indirect tax which has replaced many indirect taxes in India such as the excise duty, VAT, services tax, etc. The Goods and Service Tax Act was passed in the Parliament on 29th March 2017 and came into effect on 1st July 2017. The Goods and Services Tax (GST) is a value-added tax levied on most goods and services sold for...
GST is known as the Goods and Services Tax which is an indirect tax which has replaced many indirect taxes in India such as the excise duty, VAT, services tax, etc. The Goods and Service Tax Act was passed in the Parliament on 29th March 2017 and came into effect on 1st July 2017.
The Goods and Services Tax (GST) is a value-added tax levied on most goods and services sold for domestic consumption. The GST is paid by consumers, but it is remitted to the government by the businesses selling the goods and services.
The Gujarat High Court to hear a Public Interest Litigation (PIL) filed by the Chartered Accountant (CA) for the extension of due dates for filing For GSTR 9 & GSTR 9C for the Financial Year 2018-19 due to COVID-19 Pandemic. Dr. Avinash Poddar has filed 2 petitions one PIL in the name of Abhishek Kumar Tulsyan and another as Writ in the name of Amit Kishore Agarwal for extension of tile for filing R 9 and R 9C for 2018 -19 and 2019-20. Both the matter are listed for hearing on 31.12.2020.
Gujarat High Court directs GST Authorities to immediately Sanction Refund towards IGST paid on Goods exported made via Shipping Bills. AWADKRUPA PLASTOMECH PVT. LTD. vs UNION OF INDIA CITATION: 2020 TAXSCAN (HC) 265
The Gujarat High Court directed the Goods and Service Tax Authorities to immediately sanction refund towards IGST paid in respect to goods exported made via shipping bills. The division bench of Justice J.B. Pardiwala and Justice Ilesh V. Vora, while allowing the refunds said that if the refund of the principal amount is not sanctioned and actually paid to the writ applicant within the period of six weeks from the date of the receipt of this order, then interest would start accumulating at the rate of 9% and the amount shall be paid.
The Gujarat High Court while granting 6 weeks time to the GST Authority for the investigation refused to direct the GST Authority to give back the credit of the ITC during inquiry or investigation. “At the fag end of the investigation, we do not deem fit and reasonable to pass an order in exercise of our writ jurisdiction directing the respondents to give back the credit of the ITC to the writ applicant and permit them to avail the same. Therefore, we are saying that let the investigation be completed within six weeks and an appropriate decision shall be taken and communicated to the writ applicant,” the Gujarat High Court said.
he Calcutta High Court presided over the requirement to reverse accumulated credit by on-going real estate projects opting for a concessional rate of GST. The single-judge bench of Justice Shekhar B. Saraf allowed the parties to file affidavits and remarks that the point of maintainability of the writ petition shall be kept open. The court also granted interim relief with liberty to file an application in this writ petition if any coercive step is taken against Petitioner.
GST: Kerala High Court orders GSTN and CBIC to clarify regarding condition to apply for Refund after filing NIL refund claim. Soura Natural Energy Solutions India Pvt Ltd vs Union Of India CITATION: 2020 TAXSCAN (HC) 266
The Kerala High court ordered the GST department to clarify regarding the condition to apply for Refund after filing NIL refund claim in FORM GST RFD-01A/RFD-01. The single-judge bench of Justice Amit Rawal prima facie found the substance in the submission of Mr. Shameem Ahammed and sanguine of the fact that the Department of Revenue would come out with certain clarification. Therefore, the court posted the matter after three weeks.
The Calcutta High Court presided on the plea challenging the validity of denial of accumulated credit for services under Inverted Duty Structure. Additionally, the court also clarified that the point of maintainability of the writ petition shall be kept open and the writ petitioner shall also be at liberty to file an application in this writ petition if any coercive step is taken against it. The matter was listed for hearing on Lists the matter in March 2021.
The Allahabad High Court held that bidders are required to mention GST Rate and HSN Code in Notice Inviting Tender to ensure uniform bidding from all participants. The division judge bench of Justices Sunita Agarwal & Jayant Banerji directed the General Manager, Diesel Locomotive Works, Varanasi that if the GST value is to be added in the base price to arrive at the total price of offer for the procurement of products in a tender and is used to determine interse ranking in the selection process, he would be required to clarify the issue, if any, with the GST authorities relating to the applicability of correct HSN Code of the procurement product and mention the same in the NIT (Notice inviting tender) tender/bid document, so as to ensure uniform bidding from all participants and to provide all tenderers/bidders a ‘Level Playing Field’.
The Tripura High Court held that the adjudicating authority has no right to rectify an error after the expiry of a period of more than three months. The petitioner, M/s Kiran Enterprise is the distributor of Airtel as engaged by Bharati Hexacom Limited for Dharmanagar jurisdiction. This fact, however, is not under dispute. The petitioner has been engaged as the distributor, the petitioner is under obligation for making payment of all taxes, duties, levies, cess, search charge, or any other charges that may be applicable on the distributor or for prepaid/service offerings/ products, etc. Thus, the court held that the petitioner’s contention in respect of the extension of the Limitation Act stands dismissed. That apart, the rectification as sought is not covered by Section 161 of the TSGST Act
GST: Bombay High Court to hear plea challenging Arrest provisions under CGST Act.
The Bombay High Court to hear pleas challenging Arrest provisions under the CGST Act. A writ petition was filed by Abhishek Rastogi, partner at Khaitan & Co challenging the arrest provisions under the goods and services tax (GST) laws. Rastogi said arrests that are being matade involve interpretation of the law and not tax evasion. As such, these require in-depth analysis so that the personal liberty of persons involved is not compromised which is enshrined in Article 21 of the Constitution. Therefore, the constitutional validity of section 69 read with section 132 (1) of the Act has been challenged in the court.
The Allahabad High Court quashed the order of confiscation of goods and imposition of penalty against Metenere Ltd. The court further clarified that the confiscation of goods and the penalty imposed upon the petitioner in the order passed by the Additional Commissioner is set aside and the total penalty imposed upon the petitioner is quantified at Rs. 10,000.
Gujarat High Court quashes order cancelling GST Registration against Heugo Metal.
The Gujarat High Court quashed the order cancelling the Goods and Service Tax (GST) registration. The writ-applicant, Vimal Yashwantgiri Goswami is a proprietor of a proprietary concern running in the name of Heugo Metal. The writ-applicant is registered with the GST authority. The court while allowing the writ petition held that the impugned order passed by the respondent authority dated 25th February 2020 is quashed and set aside.
The Kerala High Court while dismissing the review petition held that the penalty under State Goods and Service Tax (SGST) can not be imposed in case of Interstate Transaction. He cannot be further mulcted with a similar amount under the SGST Act since the provisions of tax and penalty under the SGST Act are not attracted to the inter-state transaction of exempted goods covered by the IGST Act,” the court said.
The Calcutta High Court has issued the notices to the Central and State Government over Input Tax Credit (ITC) Effect of GSTR-1 Return Subject to 10% ITC for Purchase. The petitioner, LGW Industries Limited has challenged the constitutional validity and vires of Rule 36(4) of the CGST Rules/WBGST Rules and Section 43A(4) of the CGST Act/WBGST Act. The single-judge bench of Justice Shekhar B. Saraf, has issued notice to the Central and State Government to file its affidavit-in-opposition within four weeks, reply thereto, if any, two weeks thereafter.
Rajasthan High Court allows petitioner to apply to GST Council to get CENVAT Credit benefit.
The petitioner, M/s. Sunil Kumar & Company Sri Ganganagar has prayed that he may be permitted to file Form TRAN-1 in compliance with Central Goods and Services Tax Act, 2017 read with Central Goods and Services Tax Rules, 2017 in order to enable the petitioner to avail Transitional Credit in Electronic Credit Ledger. The division bench of Justice Prakash Gupta and Justice Sabina in the light of the judgement in the case of Obelisk Composite Technology LLP Vs. Union of India & Others granted liberty to the petitioner to make an application before GST Council through Standing Counsel, who is further requested to hand over the same to the jurisdictional officer for forwarding the same to the GST Council to issue requisite certificate of recommendation along with requisite particulars, evidence and a certified copy of the order instantly and such decision be taken forthwith and if the petitioner’s assertion is found to be correct, the GST Council shall issue necessary recommendation to the Commissioner to enable the petitioner to get the benefit of CENVAT credit within the stipulated time as stipulated by the Union of India.
GST: Gujarat High Court grants Bail to person accused of wrongfully availing ITC
The Gujarat High Court granted the bail to the person accused of wrongfully availing Input Tax Credit (ITC). The counsel Mr. Ankit Shah appearing for the respondent Department, submitted that the applicant had registered his trademark, which came out during the inspection at the Trademark Registry and since it was found to be a deliberate act of evasion of tax, the applicant was arrested. It was, therefore, prayed that no discretion may be exercised in favour of the applicant.
GST: Gujarat High Court issues notices to Central & State over blocking of ITC under Rule 86A.
The Gujarat High Court issued the notices to the Central and State over blocking of Input Tax Credit (ITC) under Rule 86A. The petitioner, Surat Mercantile Association has filed a petition challenging the constitutional validity and vires of Rule 86A of the Central GST Rules and the Gujarat GST Rules. The division bench headed by Chief Justice Vikram Nath and Justice J.B. Pardiwala issued notice to the Central and State Government to submit its response by 21st January 2021.
CBIC issues List of Senior/ Junior Standing Counsels, CGST for different High Courts.
The Central Board of Indirect Taxes and Customs (CBIC) issued the list of Senior/ Junior Standing Counsels, CGST for different High Courts other than Delhi High Court. The President of India appointed a fresh panel of Senior or Junior Standing Counsels of CBIC to handle litigation of Indirect Taxes before various High Courts (other than Delhi High Court) and other fora, in terms of Instruction F. No. 278A/43/2007-Legal dated December 5, 2007. The CBIC clarified that field formations (GST/Customs formations) may avail services of the Sr./Jr. Standing Counsels who have been appointed vide Board’s order F. No. 278A/07/2019-Legal (Pt.I11) dated October 1, 2020 (copy available on CBIC website) for handling DRI/DGGI cases of Indirect Taxes before various High Courts and other fora.
The Delhi High Court has sought the Centre and Directorate General of GST Intelligence’s (DGGI) reply on a plea challenging the constitutional validity of various provisions of the Central Goods and Service Tax (CGST) Act, relating to the power of arresting a person. A bench of Justices Manmohan and Sanjeev Narula issued notice to the central government and the Directorate General of GST Intelligence (DGGI) on the plea seeking to declare sections 69 and 132 of the CGST Act as unconstitutional, illegal, unenforceable and ultra vires to the Constitution.
The Allahabad High Court held that Superior Kerosene Oil (SKO) shall continue to be an excisable goods even if GST on the supply of Kerosene Oil is levied. So Indian Oil was not eligible to make a declaration under the “Sabka Vishwas Scheme”. The court held that the petitioner could avail the benefit of the “Sabka Vishwas Scheme” only in accordance with the provisions of the Scheme. “Sabka Vishwas Scheme” has specifically excluded persons seeking to make declarations with respect to excisable goods set forth in the Fourth Schedule to the Central Excise Act, 1944. Undisputedly, S.K.O. is an excisable goods set forth in the Fourth Schedule to the Act, 1944. The petitioner was not eligible to make a declaration under the “Sabka Vishwas Scheme” with respect to “S.K.O.”. Therefore, the nonacceptance of the declaration of the petitioner by the respondents does not suffer from any manifest error of law.
The Punjab and Haryana High Court has issued a notice of motion on plea challenging the validity of the levy of tax on the payment of royalty made to the Govt. of Punjab for mineral rights under reverse charge mechanism. After hearing the parties, the Division bench issued notice of motion to the respondents with respect to the reliefs as prayed for.
GST: Allahabad HC upholds Provisional attachment of Bank Accounts and FDR as it was issued for protecting interest of Government revenue.M/S R.J. Exim And Another vs The Principal Commissioner Central Goods And Service Tax And 3 Others 2020 TAXSCAN (HC) 106
The Allahabad High Court upheld the provisional attachment of Bank Accounts as it was issued for protecting interest of Government revenue. The petitioner, M/s R.J. Exim filed the petition praying to quash the impugned orders passed by the respondent authority in exercise of powers conferred under Section 83 of the Central Goods and Services Tax Act, 2017. It was further clarified that the petitioners have an opportunity to file an objection under sub-Rule 5 of Rule 159 of the Rules against the order of Provisional attachment under Section 83(1) of the Act.
The Allahabad High Court while revoking the cancellation of registration, criticised callous attitude of dept. in exercisingquasi-adjudicatory functions. The petitioner, M/S Ansari Construction was served show cause notice by the respondent authority proposing to cancel the registration certificate of the petitioner mainly on the ground that the petitioner has failed to file the return for a continuous period of six months. The court noted that the order passed by the Assistant Commissioner rejecting the application of the petitioner is wholly arbitrary and demonstrates the lack of legally trained mind as there appears to be no effort to verify the correctness of the assertions made by the petitioner at the end of the Department.
The Allahabad High Court while setting aside the orders passed by the authority held that service of notice on truck driver or fixation of copy of the order on truck is none of the methods prescribed under section 169 of the CGST Act. The petitioner, Ranchi Carrying Corporation stated that none of the notices as are required to be served under Section 129 of the GST Act have been served upon the petitioner, as such the proceedings initiated and concluded against the petitioner are ex-parte proceedings.Therefore the court set aside both the orders with a liberty to the respondents to conclude proceedings against the petitioner, in accordance with the law.
The Telangana High Court refused to grant bail to a person accused of issuing fake GST invoices passing on Input Tax Credit (ITC) to customers without actual supply. The allegation against the petitioner, Neeraj Karande is that he is managing director of M/s. GE Godavari Engineering Industries Limited. The petitioner has obtained registration under the provisions of the CGST Act. “The GST amount involved for the operations carried out by him for the period from 01.7.2017 to 31.08.2020 is Rs.10.89 crores. Admittedly, the investigation is pending,” the court while refusing the bail said.
GST Evasion: Rajasthan High Court grants Bail to person accused of creating fictitious firms and committed fraud to tune of Rs. 22 Cr
The Rajasthan High Court granted the bail to a person accused of creating fictitious firms and committed fraud to the tune of Rs. 22 Crores. The petitioner, Aditya Gupta was in custody since June 20, 2018. Maximum punishment that can be awarded is a sentence of five years. Hence, the petitioner was entitled to be released on bail. Therefore, the court held that petitioner be admitted to bail subject to furnishing bail bond in the sum of Rs. 10 Lakhs with one surety in the like amount to the satisfaction of the Trial Court.
No Consensus on Number of Questions on Constitutional Validity of NAA under GST: Delhi HC defers hearing.
The Delhi High Court deferred the hearing on the constitutional validity of the National Anti-profiteering Authority (NAA) under the goods and services tax (GST). The court decided to hear all the questions raised. The companies that dragged the indirect-tax department to court over anti-profiteering provisions under GST included Hindustan Unilever, Jubilant Foodworks, Abbott, Nestle, Whirlpool, IFB, Johnson & Johnson (J&J), etc. The petitioners have raised multiple issues related to the anti-profiteering. In an earlier hearing, the High Court had asked the lawyers of the petitioners to arrive at a consensus on the issues to be heard by the court. However, the petitioners could not arrive at a consensus and their lawyers submitted that there are around 48 issues that need resolution by the court.
No Parallel Proceedings under Central and State Acts: Gujarat High Court stays GST Proceedings
The Gujarat High court stayed the proceedings against separate complaints by State and Central GST Department against the Petitioner on the same facts. The unique case of Double Jeopardy by two criminal complaints registered by the State GST Department and Central GST Department based on the same facts wherein first State GST department registered criminal complaint against the Petition under Section 132 of Gujarat GST Act, 2017 and subsequently the Petitioner was arrested and released on bail. Considering the submissions made by the Advocate Vishal J. Dave, Avinash Poddar and Nipun Singhvi appeared for the Petitioner the High Court issued notice and also granted interim-relief that no further proceedings shall be taken qua the complaint filed by the Central GST Department.
Gujarat HC issues notice on plea challenging validity of GST charged in respect of supply has been actually paid to Government. M/S SURAT MERCANTILE ASSOCIATION vs UNION OF INDIA CITATION: 2020 TAXSCAN (HC) 109
The Gujarat High Court issued the notice to the center and state Government in plea challenging validity of tax charged in respect of such supply has been actually paid to the Government. On the second issue in the petition, it was stated that in the absence of any finding of petitioners mala fide intention, connivance, or wrongful association with the suppliers, no liability can be imposed on it on the principle of vicarious liability on account of fraudulent conduct of the suppliers, who have obtained registration on the basis of fictitious documents.
The Delhi High Court will hear more than 50 petitions challenging the constitutional validity of anti-profiteering regulations in absence of any methodology to calculate profiteering under the Goods and Services Tax (GST) law. It is said that there are tremendous ramifications be it the methodology or procedure being used by the NAA, which does not have an economic basis. The court will also look into, apart from other rules, the legality of powers given to the National Anti-profiteering Authority to determine the methodology and procedure for a determination as to whether the reduction in the rate of tax on the supply of goods or services or the benefit of the input tax credit has been passed on by the registered person to the recipient by way of commensurate reduction in prices.
The Rajasthan High Court refused to grant bail to a person accused of wrongfully availing Input Tax Credit (ITC) to the tune of Rs.108.36 Crores. The Petitioner, Mr. Vivek Raj Singh Bajwa has filed a third bail application for the offense under Sections 132(1) of Goods and Services Tax Act, 2017. The Public Prosecutor and counsel for Union of India have opposed the bail application and stated that the petitioner has created 26 firms to facilitate availment and utilization of input Tax Credit to the tune of Rs. 108.36 crores. The single-judge bench of Justice Pankaj Bhandari after considering the contentions put forth by counsel for the Union of India refused to entertain the third bail application.
Andhra Pradesh High Court quashes order levying GST on Value of broken Rice, Bran, and Husk.
The Andhra Pradesh High Court has quashed the Assessment Order for levying GST on the value of broken rice, bran and husk obtained by the petitioner on milling of the paddy. The division bench consisting of Justice U. Durga Prasad Rao and Justice K.Suresh Reddy while allowing the writ petition, quashed the assessment order in so far as it relates to the levy of GST on the value of by-products i.e., broken rice, bran and husk treating them as part of the consideration paid to the petitioner for milling of the paddy.
Calcutta HC issues notice to Govt. in PIL challenging constitution of AAR & AAAR under GST. Rajendra Kumar Duggar vs Union of India & Ors. 2020 TAXSCAN (HC) 119
The Calcutta High Court has issued notice to the Centre and State Government in a PIL challenging the constitution of Authority of Advance Ruling (AAR) and Appellate Authority for Advance Ruling (AAAR) under GST. The division bench headed by Chief Justice Thottathil B. Radhakrishnan and Justice Arijit Banerjee while sending the notice to the Union of India posed the matter to be heard on January 22, 2021.
GST: Rajasthan HC grants Bail to person accused of wrongfully availing ITC on furnishing bail bond of Rs. 1 Lakh. Subhash Chandra Tyagi vs Directorate General Of Goods And Service Tax, Intelligence 2020 TAXSCAN (HC) 120
The Rajasthan High Court granted the bail to a person accused of wrongfully availing ITC on furnishing a bail bond of Rs. 1 Lakh. The petitioner, Subhash Chandra Tyagi has been arrested in connection with Criminal Complaint registered at Chief Metropolitan Magistrate (Economic Offences Court), District Jaipur for the offence) under Section 132 of Central Goods & Services Tax Act, 2017 and later on for the offence under Section 132(1)(i)(iv) of GST Act, 2017. The single-judge bench of Justice Mahendra Kumar Goyal while allowing the bail application directed that accused-petitioner Subhash Chandra Tyagi shall be released on bail, provided he furnishes a personal bond in the sum of Rs.1 Lakh together with two sureties in the sum of Rs.50,000 each to the satisfaction of the Trial Court with the stipulation that he shall comply with all the conditions laid down under Section 437(3) Cr. P.C.
The Madhya Pradesh High Court while quashing the GST order for not complying with mandatory procedure held that the Show cause notice ought to be uploaded on revenue’s website so as to communicate it to the assessee. Therefore, the Court has no manner of doubt that statutory procedure prescribed for communicating show-cause notice/order under Rule 142(1) of CGST Act having not been followed by the revenue, the impugned demand pertaining to financial year 2019-2020 and tax period April, 2019 to July, 2019 deserves to be and is struck down.
GST: Communication of Show-Cause Notice must be on Revenue’s website and not via Email, says Madhya Pradesh HC. Akash Garg Vs. State of M.P. 2020 TAXSCAN (HC) 122
The Madhya Pradesh High Court held that the only mode prescribed for communicating the show-cause notice is by way of uploading on the website of the revenue and not through Email. The court while quashing the impugned demand held that statutory procedure prescribed for communicating show-cause notice/order under Rule 142(1) of CGST Act having not been followed by the revenue.
The Sikkim High Court held that the Appellate Authority was required to grant Sun Pharma the opportunity to explain its stand on GSTR-1 and GSTR-3B. The petitioner, Sun Pharma is a Private Limited Company engaged in the supply of patented and proprietary medicines falling under Chapter 29 and 30 of the Customs Tariff Act, 1975, made applicable to the supplies made under the Central Goods and Services Act, 2017. “After the representation is filed, an opportunity shall be granted to the representative/counsel for the petitioner for hearing, and thereafter, the Appellate Authority shall pass a fresh order with expedition and without any delay regarding the claim made by the petitioner for refund,” the court said.
GST: Madhya Pradesh HC quashes demand order as foundational Show-Cause Notice of Financial Year and Tax Period was never communicated to Individual. M/s Shri Shyam Baba Edible Oils vs The Chief Commissioner and another 2020 TAXSCAN (HC) 127
The Madhya Pradesh High Court quashed the demand order as a foundational show-cause notice of the financial year and tax period was never communicated to an individual. The division bench of Justice Sheel Nagu and Justice Rajeev Kumar Shrivastava while allowing the petition held that statutory procedure prescribed for communicating show-cause notice/order under Rule 142(1) of CGST Act having not been followed by the revenue, the impugned demand pertaining to the financial year 2018-2019 and tax period April 2018 to March 2019 deserves to be and is struck down.
The Madras High Court directed the Joint Commissioner & Assistant Commissioner to grant retrospective registration for the petitioner’s Registration Certificate. The petitioner, Tvl.Lourdes Matha Cashew Industries was issued a provisional Registration Certificate under the Goods and Service Act by the respondent authority. According to him, he had taken steps for migration from the Tamil Nadu Value Added Tax regime to the Tamil Nadu Goods and Service Tax regime. Therefore the court directed the respondent authority to consider the petitioner’s representation seeking for validation of his registration from July 1, 2017, itself and pass final orders on merits and in accordance with the law and in the light of the decisions referred to by the petitioner in his representation after giving sufficient opportunity to the petitioner, within a period of 8 weeks.
Plea challenging Section 16(4) of the CGST Act for denying ITC if not claimed within due date of Furnishing of Return: Calcutta HC issues notice. Rainbow Infrastructure Private Limited & Anr. vs Assistant Commissioner, State Tax, Goods and Service Tax 2020 TAXSCAN (HC) 129
The Calcutta High Court has issued notice to the Centre and State Government on the plea challenging the constitutional validity and vires of Section 16(4) of the CGST Act, 2017 and of West Bengal Goods and Service Tax Act, 2017. It was further pleaded that they are also violative of Article 19(1)(g) and Article 300A of the Constitution. The denial of ITC would defeat the object of the 122 nd Constitutional Amendment Bill, 2017, that is to avoid the cascading effect of taxes.
Gujarat High Court refuses to grant Anticipatory Bail to CGST Inspector alleged of Corruption
The Gujarat High Court refused to grant anticipatory bail to CGST Inspector alleged of corruption. The applicant, Gaurav Kumar Sudhashankarnkumar Arora is appointed as the Inspector in the office of the Central G.S.T. at Surendranagar and is serving in the said Department since the year of 2016. The single-judge bench of Justice B.N. Karia while dismissing the application observed that the present applicant has been charged with the offense under the Prevention of Corruption Act, 1988 and the investigation is at a very crucial stage. No exceptional or special circumstances have been pointed out by the learned applicant for the purpose of grant of anticipatory bail.
The Sikkim High Court rejected the plea seeking the refund of Central Goods and Service Tax (CGST) and 50% of Integrated Goods and Service Tax (IGST) paid through the electronic cash ledger. The Petitioner, M/s. Sun Pharma Laboratories Limited has filed an application under Order VI Rule 17 read with section 151 of the Code of Civil Procedure, 1908, seeking to insert amendments in the Writ Petition. The court said that the question of the Petitioner’s inability to raise the matter in spite of due diligence, before the matter was heard or was taken up for hearing, therefore, does not arise. In view of the questions involved in the instant Writ Petition, it cannot be said that the amendments are necessary for determining the real question in controversy between the parties considering the prayers of the Petitioner.
GST: Karnataka High Court quashes order detaining Vehicles, imposing Tax, Penalty, Interest
The Karnataka High Court quashed the order detaining vehicles, imposing tax, penalty, and interest. The Court directed authority to provide opportunity of hearing to the petitioner. The petitioner, Sanchar Telesystem Ltd. imports walkie-talkie sets only for supply to the Police and the other Government Security Departments across India. Therefore, the court while quashing the impugned order restored to the CTO for fresh consideration with the necessary opportunity to the petitioner to meet all materials that could be relied against it.
E-way Bill and Delivery Challan necessary for Interstate Delivery of Exempted Goods under GST: Kerala HC upholds Detention of Consignment. MOHAMMED SHEREEF vs THE STATE OF KERALA 2020 TAXSCAN (HC) 133
The Kerala High Court while upholding the detention of the consignment by the authorities held that the E-way Bill and Delivery Challan necessary for Interstate delivery of exempted goods under GST. The petitioner, Mohammad Sherref who is a purchaser of turmeric from an agriculturist in Karnataka, has approached against detention of a consignment in transit. Therefore, the court while disposing off the petition, directed the respondent authority to release the goods and the vehicle to the petitioner on payment of Rs.25000 by the petitioner, as required in terms of Section 129(1)(b) read with Section 129(3) of the GST Act.
The Gujarat High Court held that the Show cause notice for Confiscation of Goods or Conveyances under section 130 of the CGST Act, 2017 can not be issued on a mere suspicion. “The show cause notice under Section 130 of the Act cannot be issued on a mere suspicion. There has to be some prima facie material on the basis of which the authority may arrive at the satisfaction that the goods are liable to be confiscated under Section 130 of the Act,” the court said.
The Gujarat High Court directed the authority to release the goods and vehicles after obtaining a bond of INR 11.73 Lakhs. The writ applicant, Majid Bilalbhai Akbani is a proprietor of M/s Imran Implex and engaged in the business of trading of iron and steel and is registered under the provisions of the Central Goods and Services Tax Act, 2017. The court directed the respondent authority to release the vehicle and the goods after obtaining a bond of Rs.11,73,480 from the writ applicant. “The inquiry with respect to Form GST MOV-10 shall proceed further in accordance with law,” the court said.
Petition in Kerala High Court challenges condition to apply for Refund after filing NIL refund claim in FORM GST RFD-01A/RFD-01. Soura Natural Energy Solutions India Pvt Ltd vs Union Of India 2020 TAXSCAN (HC) 266
The Kerala High Court has issued notice over the plea challenging the condition to apply for refund after filing NIL refund claim in FORM GST RFD-01A/RFD-01. Therefore, the petitioner prayed before the court that to direct the Respondents to make facility on the GST common portal to enable the petitioner to file a revised refund claim for the tax periods, in respect of which the petitioner had inadvertently filed a ‘NIL’ refund claim or to accept such revised refund claim manually. The Petitioner was represented by Advocates Shameem Ahmed, Cyriac Tom and Thariq Maideen.
Property can’t be sold during the pendency of the GST proceedings: Madras HC directs Authority to recover Arrears of Tax. Mrs.Saraspathy Sundaraj vs The Assistant Commissioner 2020 TAXSCAN (HC) 136
The Madras High Court while directing Authority to enforce charge over subject property for recovery of arrears of tax held that the property can not be sold during the pendency of the GST proceedings. The respondent authority had furnished particulars of the attachment made in the subject property. However, the court also suggested that if the petitioner is of the view that they are willing to settle the entire arrears together with penalty to the department, liberty is hereby granted to the petitioner to approach the first respondent herein, together with the entire sales tax arrears and penalty and applicable interest, along with a representation.
The Telangana High Court directed that the authority must Refund the amount paid by the petitioner towards penalty on the pretext of noticing the wrong destination. The vendor entrusted the goods to a transporter owning vehicle for transporting the goods from the vendor’s factory at Chegunta Village and Mandal, Medak District, Telangana State to the petitioner’s premises at Proddatur, Andhra Pradesh. Therefore, the court directed the respondent authority to refund the amount with interest at the rate of 6 % per annum from 30.01.2020 till the date of payment within 6 weeks.
GST Officials can’t resort to physical violence while conducting interrogation: Telangana High Court
The Telangana High Court held that the GST Officials can not resort to physical violence while conducting an interrogation. The petitioners are a Private Limited Company incorporated under the Companies Act, 1956 involved in the business of steel. The court further ordered that any interrogation of petitioners or their employees shall be between 10:30 a.m. and 05:00 p.m. on weekdays in the visible range of an Advocate appointed by them, who shall not be in hearing range.
The Bombay High Court directed the Goods and Service Tax (GST) Authority to accept the TRAN-1 and grant due Input Tax Credit (ITC) in the electronic credit ledger. The Petitioner, Heritage Lifestyles and Developers and Private Limited is engaged in the business of construction and development of real estate for the purpose of sale to prospective buyers and is registered as a dealer under the provisions of the Maharashtra Value Added Tax Act, 2002 (MVAT) as well as registered under the provisions of the Central Goods and Services Tax Act, 2017 (CGST Act) as a ‘service provider’ and also as “registered dealer”. The court directed the Respondent Authority to accept the TRAN-1 filed by the Petitioner and to give the due of an input tax credit of Rs. 78,62,466 in the electronic credit ledger or input tax credit of the Petitioner within 2 weeks.
The Punjab and Haryana High Court granted bail to a person accused of fraudulently availing ITC without any invoice or bill. The petitioner filed this petition under Section 439 of Cr.P.C. for grant of regular bail in criminal complaints under Sections 132(1)(b)(c) of the Punjab Goods and Service Tax Act, pending before the Judicial Magistrate. The single-judge bench of Justice Harnaresh Singh Gill held that the petitioner is not required for further custodial investigation. Thus, the petition is allowed and the petitioner is ordered to be released on regular bail to the satisfaction of the learned trial Court/Duty Magistrate, subject to him furnishing bail/surety bonds.
Madras High Court quashes Interest levied u/s 50 of GST Act and directs Dept to refund Seized Amount. M/s. Maansarovar Motors Private Limited vs The Assistant Commissioner CITATION: 2020 TAXSCAN (HC) 271
The Madras High Court while quashing levy of interest on Input Tax Credit (ITC), directed the authority to refund recoveries effected through the bank. The batch of writ petitions was filed which revolved around the interpretation of Section 50 of the Central Goods and Services Tax Act, 2017, particularly the effective date of application of the proviso inserted vide Section 100 of Finance (No.2) Act of 2019. The court said that the Assessing Officers are at liberty to raise fresh demands relating to interest on delayed remittances of tax by cash, in accordance with law.
Calcutta HC issues notice to Govt. in PIL challenging constitution of AAR & AAAR under GST. Rajendra Kumar Duggar vs Union of India & Ors. 2020 TAXSCAN (HC) 119
The Calcutta High Court has issued notice to the Centre and State Government in a PIL challenging the constitution of Authority of Advance Ruling (AAR) and Appellate Authority for Advance Ruling (AAAR) under GST. The petition file by CA Rajendra Kumar Duggar wherein it was contended that the petitioner has challenged the constitution of the Authority of Advance Ruling and Appellate Authority for Advance Ruling constituted under the CGST/SGST Act being “Coram non-judice” because of the total absence of a judicial member in the constitution of AAR and AAAR. The division bench headed by Chief Justice Thottathil B. Radhakrishnan and Justice Arijit Banerjee while sending the notice to the Union of India posed the matter to be heard on January 22, 2021.
The Bombay High Court while quashing the recovery notices issued by the respondent authority held that interest would be on net cash tax liability prior to amendment in Section 50 of the CGST Act, 2017. The petitioner, KLT Automotive, and Tubular Products Limited is a limited company having its registered office at Andheri (East), Mumbai. It is engaged in the business of the manufacture of automotive components. It is registered under the Central Goods and Service Tax Act, 2017 as well as under the Maharashtra Goods and Service Tax Act, 2017. “Recovery (garnishee) notices issued by the respondents on 16.07.2020 are hereby quashed. Respondents to intimate the petitioner about the quantum of interest payable on account of delayed payment of GST for the period under consideration in terms of the administrative instructions dated 18.09.2020 and the same shall be paid by the petitioner, if not already paid,” the Court said.
The Central Board of Indirect Taxes and Customs (CBIC) has directed the residual action by CGST Commissionerates in respect of the adverse orders of High Courts, wherein the taxpayer is assigned to respective State tax administration. The Board notified that whenever GST related petitions are filed before respective High Court, Union of India is usually made one of the Respondents. “it has been observed that in some cases, Union of India/ Department of Revenue/ CBIC has not been made as respondents, even though some central legislation/ delegated legislation is under challenge. At the outset, such practice is against the Principles of Natural justice as Union should be made a Respondent before assailing any law enacted by Union. Nevertheless, to ensure efficacious defence pertaining to GST related petitions, Addendum to Master Instruction dated 14.08.2019 was issued vide the letter dated 17.08.2020 (copy enclosed), which makes it imperative for Commissioner (State Taxes) to request policy comments directly from CBIC Policy wings in such cases,” the Board said.
The Gujarat High Court held that the Commissioner was empowered to authorize ‘arrest’ prior to completion of the assessment. The petitioner is the proprietor of a M/s Heugo Metal engaged in the business of trading and supply of the stainless steel and scrap and was using the godown. “In view of the foregoing reasons, observations and directions, the petitions are accordingly ordered to be rejected. Ad interim relief granted earlier stands vacated. Rule is discharged with no order as to costs. Civil Applications, if any, stand disposed off,” the court said.
The Allahabad High Court held that once the seizure is held to be bad in law, no confiscation can take place. The petitioners, Jaymatajee Enterprise (Seller) received an order from one M/s Jagdamba Enterprises for supplying 17920 Kgs. of betel nuts and the petitioner purchased 24,000 Kgs of betel nuts from one Neelkamal Saha, West Bengal by means of two tax invoices each for 12,000 Kgs. The court directed the respondent authority to release the goods i.e. ‘Areca Nuts’ as well as the vehicle in question in favor of the petitioner. To Read the full text of the Order CLICK HERE
Gujarat High Court to reconsider GST on Intermediaries Controversy.
The controversy over the imposition of Goods and Service Tax on middlemen has surfaced again, the Gujarat High Court is planning to focus on the dispute. The issue is whether some Indian units or BPOs of multinational companies are actually supplying or exporting services. As per GST, if exports are not made then the framework should be taxed at 18%.“The review requests to relook into not only the constitutional aspect of the controversy but also that a reasoned order be passed by the GST council without being influenced by the court‘s observation on constitutionality and with the liberty to the applicant to approach the court again in case the representation is not dealt properly”, added Rastogi.
The Confederation of GST Professionals and Industries (CGPI) filed the writ petition in the Bombay High Court for the extension of the due date for filing GSTR-9/9C. On behalf of the CGPI, the advocates who appeared stated that the various problems which are being faced by professionals in view of severe restrictions on public transport and staff attendance in many places. Furthermore, the petitioner has submitted that Article 21 rights of professionals and their staff are being violated by the manifestly arbitrary and unreasonable decision to give a totally inadequate extension to the time limit. The Court has specifically said that it will resolve issues if the Government does not figure out any solution.
Gujarat High Court refuses to grant Anticipatory Bail to GST Inspector alleged of Corruption.
The Gujarat High Court refused to grant anticipatory bail to the public GST inspector alleged of corruption. The applicant, Arora prayed to release him on anticipatory bail in case of his arrest in connection with the FIR registered for the offense punishable under Sections 12, 7(a), and 13(2) of the Prevention of Corruption Act, 1988. “Considering the request made by learned advocates for the applicant, let interim protection be continued for the period of one month for challenging the order of this court by the applicant before the Higher Forum,” the court said.
The Madhya Pradesh High Court while declining the admission of Public Interest Litigation (PIL) against regular-bail order as there was no Public Interest involved in the case held that PIL cannot be filed for non-completion of GST crime investigation within time. The petitioner, Nitin Singh Bhati, a practicing advocate has filed this present petition by way of PIL. “The Code of Criminal Procedure is a complete code in itself and it provides for safeguards in respect of detention and it also provides for procedure in respect of investigation,” the court said.
The Madras High Court held that the assessee, Sutherland Global is not entitled to Education Cess (EC), Secondary and Higher Education Cess (SHEC), and Krishi Kalyan Cess (KKC) against the Output GST Tax Liability. Therefore, the court allowed the appeal of the revenue and held that the Assessee was not entitled to carry forward and set off of unutilized Education Cess, Secondary and Higher Education Cess, and Krishi Kalyan Cess against the GST Output Liability with reference to Section 140 of the CGST Act, 2017.
GST: Rajasthan HC grants bail to persons accused of wrongful availment of ITC by creating fake firms.Sandeep Goyal vs Union of India 2020 TAXSCAN (HC) 153
The Rajasthan High Court granted bail to the person accused of wrongful availment of Input Tax Credit (ITC) by creating fake firms. The petitioners, Sandeep Goyal and Rajesh Arora filed the petitions under Section 439 of Code of Criminal Procedure, 1973 seeking regular bail for offences under Sections 132(1) (b) (c) (d) (f) (i) and (l) read with Section 132 (1) (i) (iv) and read with sub-section (5) of the Central Goods and Services Tax Act, 2017. “Petitioners be admitted to bail subject to each of them furnishing bail bond in the sum of Rs. 10,00,000 with one surety in the like amount to the satisfaction of the Trial Court,” the court directed.
GST: Gujarat HC quashes Order for Cancellation of Registration as no date was fixed for hearing and no reply was awaited by Authority. M/S MAHADEV TRADING COMPANY vs UNION OF INDIA 2020 TAXSCAN (HC) 155
The Gujarat High Court quashed the order for cancellation of registration as no date was fixed for hearing and no reply was awaited by the authority. The petitioner, Mahadev Trading Company stated that the authority without fixing a date for hearing and without waiting for any reply to be filed by the petitioner, the cancellation order was passed whereby registration of the petitioners with GST department was cancelled. The division judge bench headed by the Chief Justice Vikram Nath without entering into the merits of the case held that the cancellation of registration resulting from the said show-cause notice also cannot be sustained as no proper opportunity of hearing was granted to the petitioner.
The Kerala High Court has stayed a press release dt 11.06.2020 issued by the Addl. Director-General of Goods and Service Tax Intelligence, by which the GST Department has asked all cable TV subscribers to insist for GST invoice from cable TV operators. After hearing the matter at length, the High Court had orally observed that, the GST department cannot on assumptions conclude that the local cable operators are agents of MSO unless such an allegation is proved after adjudication process. The High Court has finally stayed the operation of Press release issued by the GST Department against all cable operators except against MSOs.
Allow to submit GST TRAN- 1 Form electronically or manually: Andhra Pradesh HC directs GST Department. Lantech Pharmaceuticals Ltd. vs The Prl. Commissioner CITATION: 2020 TAXSCAN (HC) 160
The Andhra Pradesh High Court directed the GST Department either to allow the GST TRAN- 1 Form electronically or manually. The petitioner is a dealer of Hyundai cars and ancillary services, registered with GST vide registration. The court directed the respondents herein either to open the portal to enable the petitioner to again file GST TRAN-1 form electronically or in the alternative accept the GST TRAN-1 form manually on or before September 30, 2020. “Once it is uploaded or submitted manually, the claim of the petitioner may be processed in accordance with law,” the court said.
Confederation of GST Professionals and Industries had moved the Bombay High Court for the due date extension of GSTR-9 ( Annual Return ) / GSTR-9C ( Reconciliation Form) to December 31st, 2020. The Confederation of GST Professionals and Industries also started a petition in Change.org appealed Prime Minister Narendra Modi to grant Extension for GSTR 9 & 9C – Financial Year 2018/19 to at least 31st December 2020.
The Telangana High Court directed the respondent authority to refund the amount paid towards GST and penalty on the pretext of illegality in the transport of goods. The petitioner is engaged in the business of manufacture and sales of tractors and their spares. Therefore, the court directed the respondent authority to refund within four weeks the sum of Rs.6,70,448collected towards CGST and State GST and penalty from the petitioner with interest at the rate of 9% per annum from March 5, 2020 till date of payment to petitioner by the respondents. The 3rd respondent shall also pay costs of Rs.1,500 to the petitioner.
The Madhya Pradesh High Court granted anticipatory bail to a person accused of GST Evasion on furnishing the bond of Rs.10 Lakhs. The petitioner, Nitesh Wadhwani has filed the application under section 438 of the Cr.P.C. seeking anticipatory bail in crime registered under section 132(1)(a)(i) of the Goods and Services Tax Act. The single Judge bench of Justice Virendra Singh without commenting on merits of the case granted the anticipatory bail to the petitioner and directed the petitioner to furnish a personal bond of Rs.10 Lakhs with one solvent surety of the like amount to the satisfaction of Station House Officer of the Police Station concerned.
Madhya Pradesh High Court grants Bail to person accused of GST Offence.
The Madhya Pradesh High Court granted bail to the person accused of Goods and Service Tax (GST) offenses punishable under Section 132(1)(a) read with section 132(1)(i) of the Central Goods and Service Tax Act, 2017. The court directed the applicants to be released from custody on their furnishing a personal bond in the sum of Rs.5,00,000 each, with separate sureties of the like sum to the satisfaction of the Trial Court, for their appearance before it, as and when required.
GST: Rajasthan High Court quashes order freezing Bank Account beyond 1 year.
The Rajasthan High Court quashed the order freezing the bank account of the petitioner for more than 1 year. The investigation had been initiated against the petitioner, M/s Padmavati Industries, and was being carried out under the provisions of the Central Goods and Service Tax Act, 2007. The division judge bench of Justice Chandra Kumar Songara and Justice Sabina quashed the order passed by the Deputy Commissioner of Customs (Preventive) and held that the account cannot be frozen beyond the period of one year. To Read the full text of the Order CLICK HERE
Bombay HC directs GST Authority to refund Rs.4.73 Cr covered by 8 encashed Bank guarantees with Interest to LM Wind Power Blades India. LM Wind Power Blades India Pvt. Ltd. vs State of Maharashtra and ors. 2020 TAXSCAN (HC) 175
The Bombay High Court directed the respondent authority to refund an amount of Rs.4.73 Crores covered by 8 encashed bank guarantees with interest to the petitioner, LM Wind Power Blades India. The petitioner, LM Wind Power Blades India Pvt. Ltd. is a dealer registered under the CGST Act and Karnataka Goods and Services Tax Act, 2017. It is a private limited company engaged in the business of supplying components to the wind energy industry. The court further directed the petitioner to furnish a fresh bank guarantee from the nationalized bank to the respondent authority for an amount of Rs.1,65,64,279 covering the balance amount of penalty imposed on the petitioner within a period of 4 weeks.
Kerala HC orders CDRSL to pay GST on Input Services including Concession Fee; claim ITC of entire tax amount and then claim Refund. CIAL DUTY FREE AND RETAIL SERVICES LTD vs UNION OF INDIA 2020 TAXSCAN (HC) 176
The Kerala High Court ordered the petitioner CIAL Duty Free and Retail Services ltd. (CDRSL) to pay the GST on input services including Concession Fee to respondent authority and claim Input Tax Credit (ITC) of the entire tax amount and thereafter claim refund of the same by following the procedure. The bench further clarified that the petitioner shall pay the GST on input services including Concession Fee to respondent authority and claim ITC of the entire tax amount and thereafter claim refund of the same by following the procedure prescribed under Section 54(3) of the Central Goods and Services Tax Act, 2017 and Kerala Goods and Services Tax Act, 2017 read with Rule 89 of Central Goods and Services Tax Rules, 2017 and Kerala Goods and Services Tax Rules, 2017. Advocates G. Harikumar, P.Benny Thomas and Akhil Suresh appeared for the petitioners.
Delhi High Court rejects plea challenging 5% GST on all varieties of fabrics.
The Delhi High Court rejected the plea challenging 5% GST on all varieties of fabrics falling under Chapters 50 to 63 of the Customs Tariff in furtherance of the recommendations made by the Goods and Service Tax Council. “The only aspect that required introspection now stands concluded in view of the emphatic response of the GST Council in its 38th Meeting, wherein they have reiterated that the recommendation for the rate of tax was indeed 12%. The impression of contradiction that appeared in the comparison between the counter affidavit of GST Council and the minutes of the meeting has been resolved and conclusively settled,” the court said.
GST: Gujarat HC directs Release of Goods and Vehicle Confiscated on deposit of Rs.1.70 Lakh along with Bank Guarantee. M/S RADHA TRADELINKS PVT LTD vs STATE OF GUJARAT 2020 TAXSCAN (HC) 179
The Gujarat High Court directed the release of the goods and vehicle confiscated on the deposit of Rs.1.70 Lakhs along with a bank guarantee. The writ applicant, M/s Radha TradelinksPvt. Ltd. is engaged in the business of areca nut, spices, etc. A consignment of areca nut was transported from Karnataka so as to reach Ahmedabad. The court directed the authority concerned to release the goods and the vehicle at the earliest on receiving the deposit and penalty along with the bank guarantee.
The Gujarat High Court said that the time period to file an appeal would start only when the order is uploaded on the GST portal. The petitioner, Gujarat State Petronet Limited is an undertaking of the Government of Gujarat incorporated under the provisions of the Companies Act, 1956 and is engaged in the transportation of gas through pipeline, who is registered under the provisions of the Central Goods and Service Tax Act, 2017. The court, while quashing the order of the respondent authority held that merely because the petitioner has filed the appeal manually after exhausting all the efforts to ensure filing of the appeal in a proper and legal manner, the impugned order rejecting such appeal on the ground of limitation is not sustainable as the petitioner cannot be penalized for lack of clarity of the provision when the new law is enacted.
Punjab and Haryana High Court denies Anticipatory Bail to CGST official involved in Bribery Case.
The Punjab and Haryana High Court denied the anticipatory bail to the Central Goods and Service Tax (CGST) official, Gurvinder Singh Sohal involved in Bribery Case. The single-judge bench of Justice Arvind Singh Sangwan in the light of an undisputed fact that co-accused Kuldeep Hooda was arrested on the next day and a huge unaccounted amount of Rs.64 lakhs was recovered from his house, found no ground to grant anticipatory bail to the petitioner.
GST Evasion: Madhya Pradesh HC releases Kishore Wadhwani on furnishing a personal bond of Rs.10 Lakhs.Kishore Wadhwani vs State of M.P. 2020 TAXSCAN (HC) 186
The Madhya Pradesh High Court directed the respondent authority to release Director of Dabang Dunia, Kishore Wadhwani on furnishing a personal bond of Rs.10 Lakhs. Fourthly, in case of his involvement in any other criminal activity or breach of any other aforesaid conditions, the bail granted in this case may also be cancelled. Lastly, the petitioner shall submit his passport, if any, before the Trial Court and shall not leave India without prior permission of this Court.
GST can’t be Levied on Services Provided by Court Receiver: Bombay High Court.
The Bombay High Court held that Goods and Service Tax (GST) can not be Levied on Services Provided by Court Receiver. Therefore, the court held that the services of the Court Receiver are to be considered as services provided by any Court. Accordingly, the fees or charges paid to the Court Receiver are not liable to GST. The High Court held that GST cannot be levied or recovered on services provided by the Court Receiver.
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