9911796707
TMI Blog2022 (1) TMI 1213X X X X Extracts X X X X X X X X Extracts X X X X ..... the unavailability of documents to prove admissibility of the ITC, Assessment under Section 74 is proceeded. Thus, the Show Cause Notice dated 31.12.2019 does not meet the requirements of Section 74(9) of the TNGST Act, 2017. Before levying penalty or interest, a proper excise was required to be made by a proper officer under Section 74(10) after ascertaining whether the credit was wrongly availed and wrongly utilised. Though under Sections 73(1) and 74(1) of the Act, proceedings can be initiated for mere wrong availing of Input Tax Credit followed by imposition of interest penalty either under Section 73 or under Section 74 they stand attracted only where such credit was not only availed but also utilised for discharging the tax liability. The proper method would have been to levy penalty under Section 122 of TNGST Act, 2017 - the petitioner is not liable to penalty imposed. At the same time, since there was an attempt to wrongly avail credits and utilise the same as and when the tax liability would have arisen, the petitioner is held liable to a token penalty. Petition allowed in part. - W.P.No.3474 of 2021 and W.M.P.Nos.3980 & 3982 of 2021 - - - Dated:- 8-12-2021 - HON ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... st on the amount so added at the rate specified under sub-section 3 of Section 50 of the Tamil Nadu Goods and Services Tax Act, 2017. 5. The learned counsel for the petitioner further submits that Section 42 (7) will not apply as Section 47 (2) applies to the situation where will apply, in the case of a recipient. Section 42(7) of the Act reads as under:- Section 42. Matching, reversal and reclaim of input tax credit- (7). The recipient shall be eligible to reduce, from his output tax liability, the amount added under sub-Section (5), if the supplier declares the details of the invoice or debit note in his valid return within the time specified in sub-Section (9) of Section 39. 6. The learned counsel for the petitioner has also referred to decision of the Hon'ble Division Bench of the Patna High Court in the case of Commercial Steel Engineering Corporation Vs. State of Bihar, [2019] 28 GSTL 579 (Patna). A specific reference was made to Paras 29 and 35 36 which reads as under:- 29. I have reproduced the relevant provisions of the BGST Act which finds mention in the discussion held for ready reference. The legislative intent present in these provisi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ional Government Pleader for the respondent further submits that the petitioner was neither entitled to Input Tax Credit under the provisions of the erstwhile Tamil Nadu Value Added Tax Act, 2006 nor entitled to transition in the credit under the provisions of Tamil Nadu Goods and Services Tax Act, 2017 and therefore submits even on merits the petitioner is liable to pay interest and penalty for availing the transitional credit wrongly. 9. The learned Additional Government Pleader for the respondent further submits that the petitioner has admitted that the petitioner was not registered as a dealer of furniture products under the TNVAT Act, 2006 and therefore the attempt of the petitioner to avail credit and transition the same shows that the petitioner's intention was not bonafide but was to wrongly utilize the input tax credit which was not available to the petitioner. 10. That apart, it is submitted that the petitioner had un-availed credit for a sum of ₹ 2,29,850/- whereas the petitioner transitioned a credit of ₹ 3,86,271/- with a view to wrongly utilize the same. 11. The learned Additional Government Pleader for the respondent further submits that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... merely states that due to the unavailability of documents to prove admissibility of the ITC, Assessment under Section 74 is proceeded. Thus, the Show Cause Notice dated 31.12.2019 does not meet the requirements of Section 74(9) of the TNGST Act, 2017. 18. The Hon'ble Supreme Court in Union of India Vs. Ind-Swift Laboratories Limited [2011] 4 SCC 635 while construing the provisions of erstwhile Cenvat Credit Rules 2002, held that wrong filing of credit rule attracts interest under the Provisions of the Cenvat Credit Rules 2002 read with Central Excise Act, 1944. There the credit was availed and the benefit of refund was claimed. The case was attempted to be settled after payment of the amount ITC availed utilized before the settlement commission which circled interest at 10% per annum from the due dte as per Section 11 AB of the Central Excise Act, 1944. In paragraph 17 the Court held as under:- 17. We have very carefully read the impugned judgment and order of the High Court. The High Court proceeded by reading it down to mean that where CENVAT credit has been taken and utilized wrongly, interest should be payable from the date the CENVAT credit has been utilized w ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
