2024 (6) TMI 604 - HC - GST

Violation of principles of natural justice - respondent failed to provide an opportunity of personally hearing -online portal did not work properly and therefore, the petitioner could not upload eligible input tax credit - shortfall in upholding the books of account claiming for edibility insofar as the input tax credit is concerned - HELD THAT - There was a shortfall of Rs. 3,82,97,676/- vide Annexure A. The petitioner approached in W.P. No. 202419/2019. As per the order passed by the Co-Ordinate Bench of this Court, this Court stayed the operation of Annexure A so as to provide an opportunity for the writ petitioner to approach the respondent/authority for processing his request vide Annexure B in the said writ petition. The time limit was also prescribed in the said order of maximum period of 15 days. Section 16 (1) of the CGST Act and effect of Section 16(2) of the said Act has been considered by the authority and so also Section 41 (1) and 41 (2) of the said Acts were considered by the respondent. The respondent also considered the effect of Section 49 of the said Act which deals with the payment of tax, interest, penalty and other amount in the light of the delayed made by the petitioner. Taking note of all these aspects of the matter and also considering the judgment of the High Court of Telangana in the case of M/s. Megha Engineering Infrastructures Ltd. Vs. The Commissioner of Central Tax, Hyderabad and others 2019 (4) TMI 1319 - TELANGANA AND ANDHRA PRADESH HIGH COURT especially adverting to paragraph Nos. 36 and 38 of the said judgment, respondent over-ruled all the objections taken by the petitioner in making the belated payment of tax and directed that the petitioner is under statutory obligation to pay interest on the total tax liability. The contentions urged in the writ petitions on behalf of the petitioner cannot be countenanced in law - Petition dismissed.

Summary

Issues:
1. Quashing of proceedings by the respondent dated 03.06.2019
2. Completion of adjudication under Section 73 of the Central Goods and Services Tax Act 2017

Analysis:
The petitioner, a Factory situated at Kalaburagi, was assessed under the Central Excise Act, 1944, and served with a notice for recovery of a sum due to delayed filing of returns. The petitioner challenged the notice in W.P. No. 202419/2019, contending that the demand for interest on total tax liability for belated payment was made without considering their representation. The petitioner sought quashing of the order dated 03.06.2019. The petitioner's counsel argued that the demands for interest were incorrect, while the respondent's counsel supported the demands.

The petitioner's grievance included the lack of a personal hearing opportunity and technical difficulties with the online portal leading to a shortfall in upholding books of account for input tax credit eligibility. The petitioner sought waiver of interest. However, the Court found the contentions untenable as there was a significant shortfall, and the petitioner had already approached the authority for relief. The respondent considered relevant provisions of the CGST Act and upheld the statutory obligation to pay interest on the total tax liability, overruling the petitioner's objections.

The Court, after considering all aspects and a relevant judgment, dismissed the writ petitions as lacking merit. The Court held that the petitioner was under a statutory obligation to pay interest on the total tax liability, and the contentions raised could not be accepted in law. The judgment upheld the respondent's actions and dismissed the petitions.