2022 (12) TMI 409 - HC - GST

Jurisdiction of the respondent no. 3 to proceed under Section 74 of U.P. GST/CGST Act, 2017 on the basis of a survey/SIB survey - blocking ITC under Rule 86-A of U.P. GST/CGST Rules 2017 - confiscation of seized goods under Section 130 of the Act - HELD THAT - The petitioner herein has come up against the show cause notice. All issues raised herein are still open to agitate before the Assessing Officer. We, therefore, do not find any good ground to entertain the writ petition. The present writ petition is being disposed of with the observation that all the issues raised by the petitioner herein, especially the issue with regard to the jurisdiction of the Assessing Officer to proceed under Section 74, in view of the order of the appellate authority dated 19.7.2022, shall be raised before the Assessing Officer in reply to the show cause notice, the subject matter of challenge herein. Application disposed off.

Summary

Issues:
1. Challenge to show cause notice dated 25.5.2021 under Section 74 of U.P. GST/CGST Act, 2017 for the financial year 2018-19.
2. Jurisdiction of the Assessing Officer to proceed under Section 74 based on a survey/SIB survey dated 13.9.2019.
3. Appeal against orders under Rule 86-A and Section 130 of the Act, 2017.
4. Contention that all issues have been dealt with by the appellate authority.
5. Proceedings under Section 74 deemed futile due to prior appellate authority decisions.
6. Revenue contemplating challenging the order dated 19.7.2022 under Section 130 of the Act, 2017.
7. Dismissal of the writ petition but allowing the petitioner to raise jurisdictional issues before the Assessing Officer in response to the show cause notice.
8. Liberty granted to the petitioner to add to the reply to the show cause notice within two weeks for the Assessing Officer to consider all contentions, especially regarding jurisdiction.

Analysis:

1. The petition challenges a show cause notice issued under Section 74 of the U.P. GST/CGST Act, 2017 for the financial year 2018-19. The petitioner questions the jurisdiction of the Assessing Officer to proceed based on a survey dated 13.9.2019, highlighting that previous appeals against related orders have been allowed by the appellate authority. The petitioner argues that the issues leading to the demand and notice have already been addressed comprehensively by the appellate authority in its detailed orders.

2. The petitioner contends that the initiation of proceedings under Section 74 is redundant as the appellate authority has already adjudicated on matters arising from the same survey. The petitioner asserts that the Assessing Officer cannot re-examine issues already decided by the appellate authority. The respondent-department indicates a potential challenge to the appellate authority's decision under Section 130 of the Act, 2017, before the court.

3. The court notes that the issues raised by the petitioner are still open for discussion before the Assessing Officer. While dismissing the writ petition, the court allows the petitioner to raise all concerns, especially regarding the jurisdiction of the Assessing Officer, in response to the show cause notice. The petitioner is granted liberty to supplement the reply within two weeks to ensure all contentions are considered, emphasizing that the jurisdictional issue should be addressed as a preliminary matter during assessment proceedings under Section 74.

4. The court directs the Assessing Officer to consider all arguments presented by the petitioner in the reply and any additional submissions within the specified timeframe. The court emphasizes that the Assessing Officer must handle the issues strictly in accordance with the law, particularly focusing on the jurisdictional aspect of initiating assessment proceedings under Section 74 of the Act.