Retired Partner Liable for Firm's GST Dues if No Timely Intimation about Date of Retirement to Commissioner: Punjab & Haryana HC Dismisses Writ [Read Order]

Harvinder Singh (petitioner) filed the writ petition under Articles 226/227 of the Constitution of India, seeking to set aside a summoning order issued by the Excise and Taxation Officer-cum-Assistant Collector.

The order required the petitioner and other partners to deposit Rs. 37,84,228/- under the Punjab Goods and Services Tax Act, 2017 (PGST Act) and Punjab Land Revenue Act, 1887. The petitioner also sought restraint on the attachment of his property.

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The partnership firm M/s Foreigners Auto Zone was initially constituted with the petitioner, Puneet Singla, Deepak Nagpal, and Gurvinder Singh as partners. The firm underwent several changes, with partners retiring and new ones inducted. As per the petitioner's details, he retired on 20.04.2021, leaving Raswinder Singh and Deepak Kumar as existing partners.

An assessment order was passed, assessing a liability of Rs. 37,84,228/- for the year 2023-24 due to discrepancies in GST payments. A notice was issued to the petitioner and Raswinder Singh.

The petitioner discovered that his share in land (103/38990 share in 19 bighas 09 biswas) had been attached. The Petitioner submitted a representation on 11.03.2025 requesting removal of the attachment, claiming no involvement after the retirement.

The petitioner argued that he retired on 20.04.2021, before the default in 2022, and that intimation of retirement was the firm's responsibility. The Petitioner contended that he lost access to the GST portal after retirement, and liability should be fastened on existing partners.

The respondent refuted the arguments citing Section 90 of the CGST Act, which mandates intimation of retirement within one month, failing which liability continues until received by the Commissioner.

The respondents submitted that GST records still showed the petitioner as an active partner, with no amendment application filed. The respondents also submitted that proceedings under Section 73 were initiated, with notices served, but no response was received from the firm or partners.

A division bench comprising Justice Lisa Gill and Justice Sudeepeti Sharma observed that the petitioner admitted no intimation was given upon retirement in 2021. The court rejected the argument that intimation was solely the firm's duty, emphasizing Section 90's clear provision for joint and several liability.

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The bench noted that the other active partner, Raswinder Singh, was the petitioner's real brother, and no steps were taken to ensure timely intimation. The bench observed that it cannot be concluded that the petitioner was not liable under the GST Act.

The court dismissed the writ petition with liberty to the petitioner to avail alternative remedies under law. The writ petition was dismissed.

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