2020 (7) TMI 614 - HC - GST

Constitutionality and legality of National Anti-Profiteering Authority as well as Section 171 of the Central Goods and Services Tax Act and Rules 122, 126, 127 and 133 of the Central Goods and Services Tax Rules - HELD THAT - Though learned counsel for respondent no1 and 3 objects to the grant of instalments to the petitioner, yet this Court keeping in view the COVID-19 pandemic situation, directs the petitioner to deposit the principal profiteered amount i.e. ₹ 75,08,64,019/- in six equated monthly instalments commencing 15th August, 2020. List the matter on 24th August, 2020 along with other connected matters.

Summary

Issues: Challenge to the constitutionality and legality of National Anti-Profiteering Authority, jurisdiction of respondent no. 2, breach of natural justice, violation of Articles 14 and 19(1)(g) of the Constitution, deposit of tax amount, permission for instalment payments, grant of instalments, stay on interest amount and penalty proceedings, submission of written arguments.

Constitutionality and Legality of National Anti-Profiteering Authority: The petitioner challenged the constitutionality and legality of the National Anti-Profiteering Authority, along with Section 171 of the Central Goods and Services Tax Act and Rules 122, 126, 127, and 133 of the Central Goods and Services Tax Rules. The petitioner also contested the order passed by respondent no. 2 in Case No. 16/2020, alleging lack of jurisdiction, statutory non-compliance, and a conflict of interest issue where respondent no. 2 acted as both complainant and adjudicating authority.

Breach of Natural Justice and Violation of Constitutional Articles: The petitioner argued that the absence of a methodology in proceedings before the National Anti-Profiteering Authority violates natural justice and infringes upon Articles 14 and 19(1)(g) of the Constitution. Citing previous cases where the Court issued notices in similar matters, the petitioner highlighted concerns regarding procedural fairness and fundamental rights.

Deposit of Tax Amount and Instalment Payment: The petitioner expressed willingness to deposit ten percent of the remaining tax amount in accordance with Section 107(6)(b) of the Central Goods and Services Tax Act, 2017. Alternatively, the petitioner requested permission to deposit the entire principal profiteered amount in instalments due to the COVID-19 pandemic situation, referencing precedents allowing such payment arrangements.

Court Direction on Deposit and Instalments: The Court directed the petitioner to deposit the principal profiteered sum, despite objections from respondent nos. 1 and 3 regarding granting instalments. In consideration of the pandemic, the Court allowed the petitioner to pay the amount of ?75,08,64,019 in six equated monthly instalments starting from 15th August, 2020. Additionally, the Court stayed the interest amount and penalty proceedings initiated by the respondents until further orders.

Submission of Written Arguments and Next Hearing: The learned counsel for the parties were instructed to submit short written submissions not exceeding five pages each at least one week before the next hearing scheduled for 24th August 2020. The Court ordered the uploading of the order on the website immediately and directed the distribution of the order to the counsel via email.