2021 (12) TMI 1223 - HC - GST

Refund - amount which was paid during the course of investigation - seeking direction to respondent to pay the amount which was paid by the petitioner during the course when the officers of the respondent visited the premises of the petitioner and investigated - It is the case of the petitioner that the amount was paid under coercion - Wrong availment of Input Tax Credit - HELD THAT - The amount paid by the petitioner are only deposits pending proper adjudication under Section 73 / 74 of the CGST Act, 2017. It appears that the amounts were collected from the petitioner during March 2021, at the time when summons were also issued to the petitioner, Mahazar was drawn and seizure memo was also issued to the petitioner on the same date. The petitioner also appears to have sent a representation on 01.04.2021. There is no merits in this Writ Petition at this stage. The amount paid by the petitioner shall be treated as amount paid by the petitioner under protest and will be subject to the final appropriation in the proceedings to be initiated under Sections 73 / 74 of CGST Act, 2017. The respondents perhaps are investigating and therefore, seized the documents from the petitioner - the respondent is also directed to return the photo copies of the seized documents to the petitioner, if they have not been already returned to the petitioner. Petition disposed off.

Summary

Issues:
Petitioner seeking Mandamus for refund of paid amounts under coercion regarding Input Tax Credit investigation.

Analysis:
The petitioner filed a Writ Petition requesting a Mandamus to direct the respondent to refund the amounts of ?17,27,790 and ?12,60,472 paid during an investigation into alleged wrong availment of Input Tax Credit. The petitioner claimed the amounts were paid under coercion. The respondent, through the Senior Standing Counsel, argued that the Writ Petition lacked merit as the petitioner admitted to the wrong availment of Input Tax Credit. The court considered both sides' arguments.

The court noted that the amounts paid by the petitioner were considered as deposits pending adjudication under Sections 73/74 of the CGST Act, 2017. These amounts were collected during a visit where summons were issued, Mahazar was drawn, and seizure memo was issued to the petitioner. The petitioner also submitted a representation. The court found no merit in the Writ Petition at this stage and deemed the amounts paid by the petitioner as paid "under protest." The court directed the respondent to complete the investigation, issue a show cause notice within six months, and return any seized documents to the petitioner.

Furthermore, the court instructed the respondent to clearly outline the reasons and details of the Relied Upon Documents in the show cause notice. The respondent was required to complete the entire process, including issuing the notice and receiving the petitioner's reply, within twelve months. If no case was established during the proceedings, the respondent was obligated to refund the amount to the petitioner as per the law. The court disposed of the Writ Petition with these directives and closed the connected miscellaneous petition without imposing any costs.