2021 (10) TMI 980 - HC - GST

Seeking disposal of appeal filed under Section 107 of the Central Goods and Services Tax Ac, 2017 in a time bound manner - seeking to defer proceedings pursuant to Exts.P3 and P4 till the appeal preferred by the petitioner is considered - nature of activity - works contract service under Section 2(119) or a manufacture and sale of goods under the Act - HELD THAT - The interest of justice could be subserved, if the appeal filed by the petitioner is considered in a time bound manner, while the proceedings proposed to be initiated as per Exts.P3 and P4 notices are kept pending till such consideration. If the proceedings pursuant to Exts.P3 and P4 are kept in abeyance till a decision is rendered by the appellate authority, unnecessary complications and proceedings could be avoided. Ultimately it will enure to the benefit of both parties. There will be a direction to the 2nd respondent to consider and pass appropriate orders at the earliest, at any rate, within a period of two months from the date of receipt of a certified copy of this judgment - Petition disposed off.

Summary

Issues:
1. Appeal against order under Central Goods and Services Tax Act, 2017
2. Consideration of activities as works contract service or manufacture and sale of goods
3. Eligibility for composition under Section 10 of the Act
4. Requirement of deposit for appeal under Section 107(6) of the Act
5. Intimation under Section 73(5) in relation to the challenged order
6. Consideration of appeal in a time-bound manner
7. Pending proceedings in light of the appeal

Analysis:
1. The writ petition sought the disposal of an appeal filed under Section 107 of the Central Goods and Services Tax Act, 2017 in a time-bound manner. The petitioner was contesting an order (Ext.P1) that determined whether their activities constituted works contract service or the manufacture and sale of goods under the Act. The order concluded that the petitioner was engaged in the supply of works contract service, thereby affecting their tax liability under Section 9(1) or eligibility for composition under Section 10.

2. The judgment clarified that Ext.P1 did not require any immediate payment of tax, fine, or default. Consequently, the appeal (Ext.P2) could be considered without a deposit as mandated by Section 107(6) of the Act. However, the petitioner had received intimations under Section 73(5) (Exts.P3 and P4) related to the challenged order, indicating potential future proceedings.

3. After hearing both parties, the court decided that justice would be served by expeditiously considering the petitioner's appeal while keeping any proposed proceedings from Exts.P3 and P4 on hold. This approach aimed to avoid unnecessary complications and benefit both parties. The court directed the 2nd respondent to decide on the appeal within two months from the date of receipt of the judgment, with all proceedings from Exts.P3 and P4 suspended until a decision was made.

4. The judgment concluded by disposing of the writ petition in line with the above directions, emphasizing the need for a time-bound consideration of the appeal and the suspension of related proceedings until the appellate authority's decision.