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2018 (11) TMI 954 - HC - GSTRelease of detained goods - remittance of amount under the head SGST , instead of IGST - Held that - The petitioner, as a consignee and transporter, purchased goods from the consignor in Chennai. While those goods were in transit, they were detained. Further not in dispute is the fact that the consignor paid the tax and penalty. Either on the ASTO s advice or on its own, it remitted the amount under the head SGST , instead of IGST - Section 77 provides for the refund of the tax paid mistakenly under one head instead of another. But Rule 4 speaks of adjustment. Where the amount of refund is completely adjusted against any outstanding demand under the Act, an order giving details of the adjustment is to be issued in Part A of FORM GST RFD-07. There is no difficulty for the respondent officials to allow the petitioner s request and get the amount transferred from the head SGST to IGST - goods alongwith vehicle is released - petition disposed off.
Issues:
1. Incorrect remittance of tax and penalty under SGST instead of IGST by the consignor. 2. Refusal by authorities to release goods due to incorrect remittance. 3. Interpretation of Section 77 of the GST Act and Rule 4(1) of the GST Refund Rules, 2017. 4. Dispute over whether the amount remitted under one head can be adjusted under another head. Analysis: The judgment revolves around a case where a registered dealer, acting as a consignee and transporter, faced an issue when goods purchased from Chennai were detained in transit by the Assistant State Tax Officer (ASTO) in Kerala. The consignor had paid the tax and penalty under SGST instead of IGST, leading to the authorities refusing to release the goods. The petitioner contended that the remittance should have been under IGST, as per the ASTO's directions. The court examined Section 77 of the GST Act, which allows for the refund of tax paid mistakenly under one head instead of another. The petitioner's counsel highlighted Rule 4(1) of the GST Refund Rules, emphasizing the process of adjustment mentioned in the rule. The rule specifies that if the refund amount is completely adjusted against any outstanding demand under the Act, an order detailing the adjustment should be issued. The counsel argued that the amount remitted under SGST could be adjusted under IGST, as the demand could be any amount under the Act. The court found merit in the petitioner's argument and directed the respondent officials to release the goods and ensure the tax and penalty paid under SGST is transferred to IGST. While acknowledging that the process might take time, the court deemed it unfair for the authorities to let the petitioner suffer due to the delay. Consequently, the court disposed of the writ petition in favor of the petitioner, ordering the release of goods and the necessary transfer of the remitted amount to IGST. In conclusion, the judgment clarifies the provisions of the GST Act and the GST Refund Rules regarding the adjustment of tax amounts paid under different heads. It underscores the importance of ensuring equitable treatment for taxpayers and upholding the principles of justice in resolving disputes related to tax remittances under the GST regime.
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