2019 (1) TMI 549 - HC - GST

Imposition of penalty equal to 200% of the tax - the penalty order was an appealable order, however, since no Appellate Authority had been constituted so far, therefore, the petition was being filed - Held that - Additional Commissioner (Appeals) has been appointed to perform the functions as an Appellate Authority under Section 107 of the Punjab Goods and Service Tax Act, 2017 and rule 109A of the Punjab Goods and Service Tax Rules, 2017 - the writ petitions disposed off by relegating the petitioners to take recourse to the remedy of appeal before the Appellate Authority, in accordance with law - petition disposed off.

Summary

Issues:
1. Quashing of penalty order dated 04.10.2017 passed by State Tax Officer.
2. Constitutionality of penalty equal to 200% of the tax imposed by the State Tax Officer.
3. Appointment of Additional Commissioner (Appeals) under Section 107 of the Punjab Goods and Service Tax Act, 2017.

Issue 1: Quashing of Penalty Order
The petitioner, engaged in fabrication and trading of iron and steel products, sought the quashing of the penalty order dated 04.10.2017 imposed by the State Tax Officer. The primary grievance was against the penalty equal to 200% of the tax. Despite the penalty order being appealable, the petitioner filed a writ petition due to the absence of a constituted Appellate Authority at the time.

Issue 2: Constitutionality of Penalty
The petitioner challenged the penalty order imposing a penalty equal to 200% of the tax. The petitioner's counsel highlighted the lack of an Appellate Authority, leading to the filing of the writ petition. The State produced a notification appointing an Additional Commissioner (Appeals) to act as the Appellate Authority under Section 107 of the Punjab Goods and Service Tax Act, 2017 and rule 109A of the Punjab Goods and Service Tax Rules, 2017. Consequently, the court disposed of the writ petitions, directing the petitioners to appeal before the newly appointed Appellate Authority.

Issue 3: Appointment of Additional Commissioner (Appeals)
The Government of Punjab appointed an Additional Commissioner (Appeals) to function as the Appellate Authority under the relevant provisions of the Punjab Goods and Service Tax Act, 2017. The notification clarified the powers conferred on the appointee to act as the Appellate Authority. The court, considering the appointment of the Appellate Authority, directed the petitioners to pursue the remedy of appeal before the newly constituted authority in accordance with the law. However, to address the pending proceedings, the court allowed a 30-day window for filing appeals without dismissal on the grounds of limitation by the Appellate Authority.