Jharkhand HC quashes GST Order Passed without considering stipulation u/s 16(5) of CGST Act, Remands Matter [Read Order]
The decision was in absence of the consideration by following the stipulation made in sub-section (5) of Section 16 which has been made effective w.e.f. 1st day of July, 2017
Jharkhand High Court, CGST Act. GST Order
Jharkhand High Court, CGST Act. GST Order
In a recent case the Jharkhand High Court quashed the Central Goods and Service Tax ( CGST) order passed without considering stipulation under section 16(5) of CGST Act,2017 and remanded the matter for reconsideration.
The petitioner,Vinod Udaipuri sought for issuance of an appropriate writ/order/direction for declaring Section 16(4) of the Central Goods and Services Tax Act, 2017 as ultra vires, in as much as it seeks to impose a time limit for the availment of Input Tax Credit being violative of Article 14, Article 19(1)(g) and Article 300A of the Constitution of
India and also being violative of the basic structure of the Central Goods and Services Tax Act, 2017.
Further appropriate writ/order/direction for declaring the amendment carried under Rule 61(5) of the Central
Goods and Services Rules, 2017 inserted vide Clause 4(a) of Notification No. 49/2019 dated 9th October, 2019, issued by Respondent No.-2 Central Board of Indirect Taxes and Customs (Annexure-7) as ultra vires, under which GSTR-3B has been declared to be a valid return under Section 39 of the Central Goods and Services Act, 2017 with retrospective effect from 01.07.2017, as being wholly violative of Article 14, Article 19(1)(g) and Article 300A of the Constitution of India as it has an effect of interfering with the vested right of the Petitioner to avail Input Tax Credit.
Mr. Sumeet Gadodia, counsel for the petitioner, has submitted that in view of the provision of Section 118 of the Finance Act, 2024, the matter needs to be decided afresh and as such, the impugned Order-in-Original and Summary of Order may be quashed and set aside so that matter be decided, on remand, afresh.
Counsel for respondents Mr. Amit Kumar has submitted that in view of the provision as inserted in the Finance Act, 2024 as under Section 118 thereof, the matter needs to be adjudicated afresh.
The demand raised on account of the violation of Section 16(4) of the JGST Act as would be evident from paragraph-5 of the impugned order. It is evident that the Gazette Notification has been issued on 16.08.2024 by inserting sub-section (5) under Section 16 of the CGST Act w.e.f. 1st day of July, 2017 after sub-section (4).
It is evident that the insertion of the aforesaid provision has been made effective from the 1st day of July, 2017, whereby and whereunder, it has been provided that “Notwithstanding anything contained in sub-section (4), in respect of an invoice or debit note for supply of goods or services or both pertaining to the Financial Years 2017- 18, 2018-19, 2019-20 and 2020-21, the registered person shall be entitled to take input tax credit in any return under section 39 which is filed upto the thirtieth day of November, 2021”.
The High Court Bench of Chief Justice Tarlok Singh Chauhan and Justice Rajesh Shankar observed that the decision which has been taken as impugned in the present writ petition was in absence of the consideration by following the stipulation made in sub-section (5) of Section 16 which has been made effective w.e.f. 1st day of July, 2017.
The Union, due to the aforesaid reason, is consenting for adjudication of the issue afresh. Considering the implication of insertion of sub-section (5) under Section 16 of the CGST Act, the Court quashed and set aside the impugned Order-in-Original dated 19.05.2023 and Summary of Order dated 25.08.2023.
The matter was thus remitted before the authority to pass a fresh order taking into consideration the implication of sub-section (5) of Section 16 of the CGST Act.
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