Newsletter – Vol. 2, Issue 13 – 27.03.2022

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Notice to be given u/s. 73 for the disputed liability of interest, violation of PNJ: Hon’ble Jharkhand High Court
In M/s Narsingh Ispat Ltd. v. UOI and Ors., W.P. (T) No. 177 of 2021, W.P. (T) No. 1261 of 2020 and W.P. (T) No. 161 of 2021, Hon’ble HC held that it has been held (in Mahadeo Constructions) that if an assessee disputes the liability of interest i.e., either disputes its calculation or even the leviability of interest, then the only option left for the Assessing Officer is to initiate proceeding either under Section 73 or 74 of the Act for adjudication of the liability of interest. In the present case, the petitioner has disputed the interest liability by filing reply. Respondent had also indicated that in case petitioner fails to deposit the amount of tax and interest by 05.02.2020, show-cause notice under section 73(1) shall be issued. Respondent have themselves failed to follow the procedure stipulated under the Act as indicated by them in Form GST DRC-01A containing the intimation of the tax ascertained against the petitioner. Summary of the Order has been issued upon the petitioner in Form GST DRC-07 on his GSTN portal without following the principles of natural justice.

Appeal for cancellation of registration is not time-barred, as covered by G.O. No. 792 dated 29.07.2020 and suo moto extension of limitation by Hon’ble Supreme Court: Allahabad High Court
In M/s J.K. Infratech v. Additional Commissioner and Ors., Writ Tax No. 76 of 2022, Hon’ble HC held that Government of U.P. issued Government Order no. 792 dated 29.7.2020 providing, in cases involving facts such as those obtaining in the present case, the service of the orders would be deemed to have been made on 31.8.2020. Then the period of limitation to institute appeal etc., stood suspended by various orders passed by the Supreme Court as also this Court. Thus, the period of limitation from 15.3.2020 to 14.3.2021 stood suspended.…. Once the order dated 17.9.2019 is taken to have been served on the petitioner on 31.8.2020, then in view of the suspension of limitation from 15.3.2020 to 14.3.2021 the limitation to file the appeal would start running from 15.3.2021. In that case, the appeal having been filed on 19.3.2021, the same was wholly within time.

The day of remand to be included while calculating the sixty days period for default bail: Hon’ble Punjab & Haryana High Court
In Rohit Mehra v. Superintendent CGST, Ludhiana and Ors., Criminal Revision No. 60 of 2022 (O&M), the issue was whether the day of the remand should be included while calculating the sixty-day period for default bail, the Hon’ble HC leaned the interpretation in favour of the bail applicant with the condition that in case the decision of the Larger Bench of the Hon’ble Supreme Court (Enforcement Directorate Vs. Kapil Wadhawan & Anr., Criminal Appeal No. 701-702 of 2020) is against the inclusion of the day of remand in calculating the period of custody, it would be open to the respondent to seek modification/ recalling of this order.

Department Appeal against Bundl Technology Pvt. Ltd. dismissed: Hon’ble Karnataka High Court
In UOI and Ors. v. Bundl Technology Pvt. Ltd., W.A. No. 1274 OF 2021 (T-RES) in W.P. No. 4467 of 2021 (T-RES), the appeal filed by the department on all issues were answered against them, issues include interalia (i) collection of tax during the investigation – the amount was voluntarily paid during the investigation by the company under section 74(5) of CGST Act or not? (ii) amount was recovered from the company during an investigation under the coercion and threat of arrest or not? matter conducted in a high handled and arbitrary manner during the course of the investigation or not? (iv) petition filed by company suffers from delay or laches or not?. Bundl Technology before Hon’ble Single Judge available at Newsletter – Vol. 1, Issue 16.

Vague SCN with one-line allegation quashed: Hon’ble Calcutta High Court
In M/s Galaxy Mechanical Engineering Equipment Pvt. Ltd. & Anr. v. Assistant Commissioner, Bally WBGST & Ors., WPA No. 2857 of 2022, Hon’ble HC held that so far as part of the impugned show-cause notice for cancellation of registration, where registration of the petitioner has been suspended this part of the impugned order will remain suspended since the allegation in the impugned show-cause notice is very vague and one line allegation without any basis and for the ends of justice a person against whom a show-cause notice has been issued, he should be at least provided in brief the basis of such allegation so that the person can meet the allegations in the show-cause notice. The impugned order of suspension will remain suspended till the reply to the impugned show cause notice is given and hearing is given on the same and is disposed of by passing a reasoned and speaking order in accordance with law.  

Bail Allowed:
In Niraj Jaidev Arya v. State of Gujarat, R/Criminal Misc. Application No. 23127 of 2021 – availment of illegal input tax credit – fictitious entities – fake purchases from 24 fictitious entities – allegation against the applicant is of committing an offence under section 132(1)(c) of the GGST Act & CGST Act – Hon’ble Gujarat High Court.
Anticipatory Bail – In Akshat Jain v. UOI and Ors., Criminal Misc Anticipatory Bail Application (u/s. 438 of the Cr.P.C.) No. 1771 of 2021 – implication can be made under cognizable and nonbailable offences u/s. 132 (5) of the C.G.S.T. Act, if the allegations are found to be correct – Hon’ble Allahabad High Court.

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