2023 (4) TMI 308 - HC - GST

Short payment of GST - suppression of outward supply of taxable goods - petitioner entered into an agreement with its recipients on a letter after giving post supply volume discount and issued GST Credit notes involving tax amount in question in order to reduce its value of supply during the relevant period - contravention of Section 15(3) (b) (i) of the CGST/WBGST Act, 2017 - non-constitution of statutory appellate forum of Tribunal - HELD THAT - Since it is an admitted position that there is no further statutory appellate forum of Tribunal available at present for redressal of the petitioner s grievance and in view of the discussion made, and that petitioner has been able to make out a case for entertaining this writ petition for two reasons, firstly, at present petitioner has no alternative forum of the Tribunal for its remedy and secondly that the amount of recovery of demand is more than 20% of the disputed tax and the ground that the petitioner does not exist in its registered place of address was neither a part of the show-cause notice nor there is such finding in this regard by the first appellate authority. Considering the facts and circumstances of the case and submission of the parties and discussion made above, the issues involved in this writ petition deserve adjudication after calling for affidavits from the respondent - List this matter for final hearing in the monthly list of June, 2023 under the heading Hearing .

Summary

Issues involved: Challenge to impugned order under WBGST Act, recovery of demand without notice or hearing, unavailability of Tribunal for appeal, recovery exceeding 20% of disputed tax, existence of petitioner at registered place, mismatch of transaction.

Challenge to impugned order: The petitioner challenged the order dismissing their appeal under the WBGST Act, alleging that they had entered into an agreement with recipients to reduce the value of supply, resulting in short payment of tax and suppression of outward supply of taxable goods.

Recovery of demand without notice: The petitioner objected to the recovery of demand within 24 hours of the appellate order, contending that it was done without providing any opportunity of hearing or notice, and without allowing time to file an appeal or granting a statutory period of three months.

Unavailability of Tribunal for appeal: The petitioner highlighted that although the impugned order was further appellable before the Tribunal, the forum had not been established by the Government, leaving the petitioner without a redressal mechanism for their grievance.

Recovery exceeding 20% of disputed tax: The petitioner argued that the recovery of more than twenty percent of the disputed tax during the pendency of an appeal was not permissible, especially when the Tribunal was not available as an appellate forum.

Existence of petitioner at registered place, mismatch of transaction: The respondent contended that recovery was justified under Section 78 of the Act due to the petitioner's non-existence at the registered place and a mismatch of transaction. However, the court found these allegations unsubstantiated as they were not part of the show-cause notice or the impugned order.

Court's decision: The court acknowledged the absence of an alternative forum for the petitioner's remedy due to the unavailability of the Tribunal. It directed the respondents to file an affidavit-in-opposition and allowed the petitioner to reply. The matter was listed for final hearing in June 2023. The respondent authority was instructed to refund the excess amount collected from the petitioner within seven days, provided the petitioner executed a bond for the balance of the disputed tax.