Newsletter – Vol. 2, Issue 3 – 16.01.2022

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Levy of GST on the amount of royalty stayed: Hon’ble Jharkhand High Court
In M/s Ratan Black Stone v. UOI and Ors., W.P (T) No. 4609 of 2021, Hon’ble HC held that on consideration of the materials on record placed by the parties and in view of interim protection granted by the Apex Court in Writ Petition (Civil) No. 1076/2021 in the case of M/s Lakhwinder Singh v. UOI and Ors., that the petitioners herein, lessee of minor mineral, also raised similar issues of levy of GST on royalty and District Mineral Fund Contribution, we deem it proper to grant similar interim relief(s) to the petitioners herein. Accordingly, until further orders, payment of GST for grant of mining lease/royalty by the petitioners, shall remain stayed.

The difficulty in amending the Tran-1 is on account of the Architecture of the Web Portal which did not permit the petitioner to make such amendments: Hon’ble Madras High Court
In M/s Vikas Elastochem Agencies Pvt. Ltd. v. The Deputy Commissioner Central Excise & GST and Ors., W.P. No. 23107 of 2021, it is the case of the petitioner that instead of making a proper entry against 7(a) of Tran 1, the petitioner has made an entry in 7(d) and the petitioner had also made another attempt to rectify the mistake on 27.12.2017. Hon’ble HC held that the procedure prescribed under the provisions of CGST Act, 2017 and the respective State Enactments and the Rules made thereunder should not come in the legitimate way of transitional credits as such credits were already available for being utilized for discharging the tax liability. These amounts cannot lapse. The difficulty in amending the Tran-1 is on account of the Architecture of the Web Portal which did not permit the petitioner to make such amendments. The petitioner cannot be found fault of Architecture of the Web Portal did not have such facility. Input Tax Credit once availed are indefeasible and cannot lapse.

Multiple investigations are brought under one umbrella of the DGGI AZU: Hon’ble Delhi High Court
In M/s Indo International Tobacco Ltd. v. Additional Director General, DGGI and Ors., W.P. (C) 2420/2021, W.P. (C) 4036/2021 & CM 12202/2021, the writ petition is filed after being aggrieved of multiple search operations and summons being issued. Hon’ble HC held that in the present set of writ petitions, the respondents have explained that to bring investigation under one umbrella, the DGGI AZU sought transfer of investigations being carried out by different Commissionerate(s) to itself. This was acceded to by each Commissionerate in both the writ petitions. We have not been shown any prohibition in the CGST Act or the SGST Act to such transfer of investigation. Neither it has been contended that the DGGI, AZU, would otherwise lack jurisdiction to carry out an investigation against the petitioners. It is not denied by the petitioners that the DGGI, AZU has a pan-India jurisdiction. DGGI, AZU would, as Central Tax Officer and in compliance with the mandate of Section 6 of the CGST Act and the SGST Act, have to pass comprehensive order, both under the CGST Act as also the SGST Act. 

The issuance of summons is a last resort and are not issued in a casual manner: Hon’ble Bombay High Court
In M/s FSM Education Pvt. Ltd. v UOI, W.P. (L) No. 30974 of 2021, the petitioner prays for a writ of mandamus or any other writ to quash and set aside the summons issued to Ms. Tanuja Gomes (Director) and seeks direction to the Respondents to conduct an enquiry without initiating summons and interrogation unless found extremely necessary and only by due adherence of the law. Hon’ble HC held that a perusal of the reply to question 34 of FAQs dated 15 December 2018, issued by GST Department would indicate that issuance of summons is a last resort and are not issued in a casual manner. There are no allegations made by the Respondents alleging non-cooperation on the part of the Petitioner. A perusal of the averments in para 7.1 indicates the said summons was issued only in view of the statement made by Shri Piyush Patel which was recorded under Section 70 of the CGST Act 2017, that the decision regarding payment of taxes and claiming of exemption was taken by the director Ms. Tanuja Gomes. In the affidavit-in-rejoinder filed by the Petitioner and the affidavit filed by Mr. Piyush Patel, the averments made by the Respondents in para 7.1 of the reply are denied. The impugned summons dated 23 December 2021 issued to Ms. Tanuja Gomes, Director of the Petitioner company would not survive in view of the undertaking given by the petitioner and in view of the aforesaid directions issued by this Court

Another officer who was assigned the matter was required to give a fresh opportunity of personal hearing to the petitioner: Hon’ble Gujarat High Court
In M/s TEC India Customer Solutions Pvt. Ltd. v. Deputy Commissioner of Sales Tax and Ors., R/SCA No. 18270 of 2021, Hon’ble HC held that so far as the non availment of the opportunity of hearing is concerned, the officer, who has heard the petitioner has not delivered the order and the one who has passed the order impugned has done so without availing a fresh opportunity to the petitioner. This is a ground which has been raised emphatically before the Court and rightly so. The officer concerned, if had any doubt or question on the issue to be addressed while deciding the matter on merit, the opportunity of hearing to the petitioner could have been given and then the matter ought to have been decided in accordance with the law.

While computing the period of limitation in case of Refund Application under GST, the period from 15th March 2020 till 2nd October 2021 shall stand excluded: Hon’ble Bombay High Court
In M/s Saiher Supply Chain Consulting Pvt. Ltd. V. UOI and Ors., W.P. (L.) No. 1275 of 2021, Hon’ble HC held that in our view, Respondent No. 2 is also bound by the Order (Supreme Court Order for extension) dated 23rd March 2020 and the Order dated 23rd September 2021 and is required to exclude the period of limitation falling during the said period. Since the period of limitation for filing the third refund application fell between the said period 15th March 2020 and 2nd October 2021, the said period stood excluded. The third refund application filed by the Petitioner thus was within the period of limitation prescribed under the said Circular dated 18th November 2019 read with Section 54(1) of the Central Goods and Services Act, 2017. In our view, the impugned Order passed by the Respondent No. 2 is contrary to the Order passed by the Hon’ble Supreme Court and thus deserves to be quashed and set aside.

Cash Credit Account cannot be provisionally attached u/s. 83 of the Act: Hon’ble Gujarat High Court
In M/s Manish Scrap Traders v. Principal Commissioner, R/SCA No. 76 of 2022, Hon’ble HC held that the law is well-settled that a cash credit account of the assessee cannot be provisionally attached in the exercise of powers under Section 83 of the CGST Act – relied upon Kaneria Granito Ltd. v. Assistant Commissioner of Income Tax, Special Civil Application No. 14497 of 2014 decided on 27.06.2016.

Bail Allowed: Seeking grant of Bail – bogus ITC was claimed on the strength of fake invoices without physical receipt and supply of goods – Section 132(1)(c) of CGST Act, 2017 – Rohit Berlia v. The Intelligence Officer, DG of Goods and Services Tax Intelligence, Bhubaneswar – BLAPL No. 8831 of 2021 – Hon’ble Orissa High Court 

Anticipatory Bail Allowed: Seeking grant of interim protection – grant of interim anticipatory bail – Section 132(1)(a)(b)(c)(d) (i) Central Goods and Services Tax Act – Criminal Misc. Anticipatory Bail Application U/s 438 CR.P.C. No. – 19059 of 2021 – Hon’ble Allahabad High Court 

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