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TMI Blog2022 (4) TMI 823X X X X Extracts X X X X X X X X Extracts X X X X ..... o the petitioner's case and after going into the validity and legality thereof be pleased to quash and set aside the impugned show cause notice dated 14.03.2022; (b) Your Lordships be pleased to issue a writ of mandamus or any other appropriate writ in the nature of mandamus ordering and directing the respondents to forthwith refrain from taking any further steps or proceeding pursuant to or in implementation of the impugned notice dated 14.03.2022 issued by respondent No.3; (c) That pending the hearing and final disposal of the above petition, this Hon'ble Court be pleased to, stay the effect and operation of impugned notice dated 14.03.2022; (d) An ex-parte ad-interim relief in terms of prayer (c) above may kindly be granted; (e) Costs of the petition be provided for; and (f) Such other and further order or orders as may be deemed just and proper in the facts and circumstances of the present case may kindly be granted." 4. The facts giving rise to this writ application may be summarized as under: 5. The writ applicant has received an intimation of the tax ascertained as being payable under Section 74(1) and (5) resply of the GST Act, 2017 in the Form GST DRC - 01 date ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... LIMITED GSTN 24AANCA7754P1ZX you have received input tax credit of Rs. 6,42,60,812/- SGST and Rs. 6,42,60,812/- CGST. And from MANMISH TRADERS PRIVATE LIMITED GST NO. 24AAGCM6660D2ZL showed purchase of Rs. 41,66,06,984/- and claimed tax credit of Rs. 60,67,092/- SGST and Rs. 60,67,092/- CGST. And as mentioned above in aggregate you showed a purchase of Rs. 4,82,91,81,986 from both the supplier and have claimed Input Tax Credit of Rs. 7,03,27,905/SGST and Rs. 7,03,27,905/- CGST aggregating to Rs. 14,06,55,810/-. Above referred both the vendor's business details and GST registration number detail is as follows:- (i) ASTERPATEL TRADE & SERVICES PRIVATE LIMITED GSTN24AANCA7754P1ZX (Cancelled suo-moto) Date of Cancellation 31.03.2019 (The effective date of cancellation of your registration is 25.01.2018. In case, Registration has been obtained by means of fraud, willful misstatement or suppression of facts.) (ii) MANMISH TRADERS PRIVATE LIMITED GST NO 2411GCM6660D2ZL (Cancelled suo-moto) Date of Cancellation 29.11.2017 (The effective date of cancellation of your registration is 25.01.2018. In case, Registration has been obtained by means of fraud, willful misstatement or suppressio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 348826408 DETAILS OF PAYABLE TAX PAYABLE TAX INTEREST PENALTY PENALTY TOTAL CGST 70327905 33757394 70327905 174413203 SGST 70327905 33757394 70327905 174413203 TOTAL 140655810 67514788 140655810 348826406 Thus, you are not eligible to claim Input Tax Credit of Rs. 7,03,27,905/for SGST and Rs. 7,03,27,905/- for CGST. And interest on the said amount of Rs. 6,75,14,788/- remains recoverable from you under the provision of section 50 of Gujarat Goods and Services Tax Act, 2017. Accordingly, it is informed to you to repay the above amount under section 74(8) of GST ACT within 15 days via DRC-03. In case if you wish to provide any explanation or clarification same can be done by 11.04.2022 along with supporting documents / evidence. If you fail to produce DRC-03 by paying said Tax, interest and penalty within the above time or clarification with supporting evidence not done then it shall be deemed that you want to state nothing and then you shall be made responsible for the payment of Rs. 348826406/- for tax, interest and penalty which shall be recoverable according to the law. The same to be noted accordingly. Date: 14.0 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fixed accordingly. 11. In such circumstances referred to above, Mr. Sharma prays that there being no merit in the present writ application, the same may be rejected. * ANALYSIS: 12. Having heard the learned counsel appearing for the parties and having gone through the materials on record, the only question that falls for our consideration is whether we should quash and set aside the notice of intimation of tax issued by the Assistant State Tax Commissioner, Ghatak - 3, Ahmedabad, in Form GST DRC - 01. 13. Before adverting to the rival submissions canvassed on either side, we must look into Section 74 of the Act, 2017. Section 74 reads thus: "74. Determination of tax not paid or short paid or erroneously refunded or input tax credit wrongly availed or utilized by reason of fraud or any willful- misstatement or suppression of facts. (1) Where it appears to the proper officer that any tax has not been paid or short paid or erroneously refunded or where input tax credit has been wrongly availed or utilised by reason of fraud, or any wilful mis statement or suppression of facts to evade tax, he shall serve notice on the person chargeable with tax which has not been so paid or w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he said notice shall be deemed to be concluded. (9) The proper officer shall, after considering the representation, if any, made by the person chargeable with tax, determine the amount of tax, interest and penalty equivalent to ten percent of tax or ten thousand, whichever is higher, due from such person and issue an order. (10) The proper officer shall issue the order under sub-section (9) within a period of five years from the due date for furnishing of annual return for the financial year to which the tax not paid or short paid or input tax credit wrongly availed or utilised relates to or within five years from the date of erroneous refund. (11) Where any person served with an order issued under sub-section (9) pays the tax along with interest payable thereon under section 50 and a penalty equivalent to fifty per cent. of such tax within thirty days of communication of the order, all proceedings in respect of the said notice shall be deemed to be concluded. Explanation 1 : For the purposes of section 73 and this section. - (i) the expression "all proceedings in respect of the said notice" shall not include proceedings under section 132; (ii) where the notice under th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... refer to the above proceedings. In this regard, the amount of tax/ interest/penalty payable by you under section 73(5)/74(5) with reference to the said case as ascertained by the undersigned in terms of the available information, as is given below: Act Period Tax CGST Act SGST/UTGST Act IGST Act Cess Total The grounds and quantification are attached / given below: You are hereby advised to pay the amount of tax as ascertained above alongwith the amount of applicable interest in full by ........ , failing which Show Cause Notice will be issued under section 73(1). You are hereby advised to pay the amount of tax as ascertained above alongwith the amount of applicable interest and penalty under section 74(5) by ........ , failing which Show Cause Notice will be issued under section 74(1). In case you wish to file any submissions against the above ascertainment, the same may be furnished by......... in Part B of this Form. Proper Officer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on - I hereby solemnly affirm and declare that the information given hereinabove is true and correct to the best of my knowledge and belief and nothing has been concealed therefrom. Signature of Authorized Signatory Name Designation / Status Date:........." 19. The Form GST DRC - 01A should be read with Rule 142 (1A) of the Rules, 2017. Rule 142 (1A) of the Rules, 2017 reads thus: "(1A) The proper officer may, before service of notice to the person chargeable with tax, interest and penalty, under sub-section (1) of Section 73 or sub-section (1) of Section 74, as the case may be, shall communicate communicate the details of any tax, interest and penalty as ascertained by the said officer, in Part A of FORM GST DRC - 01A." 20. The Form GST DRC - 03 referred to above should be read with Rules 142(2) and 142(3) reply of the Rules, 2017. Rule 142(2) reads thus: "Notice and order for demand of amounts payable under the Act. 142(2). Where, before the service of notice or statement, the person chargeable with tax makes payment of the tax and interest in accordance with the provisions of sub-section (5) of Section 73 or, as the case may be, tax, interest and penalty in accorda ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... filled up. 2. Column Nos.2, 3, 4 and 5 of the above Table i.e. tax rate, turnover and tax period are not mandatory. 3. Place of Supply (POS) details shall be required only if the demand is created under the IGST Act." 23. As noted above, by virtue of sub-section (5) of Section 74, one opportunity is given to the dealer to pay the amount towards tax as ascertained by the proper officer or on the basis of his own ascertainment. If the dealer proceeds to avail the benefit of sub-section (5), then he gets the benefit of sub-section (6) of Section 74 of the Act. In other words, no show cause notice would be issued thereafter under sub-section (1) of Section 74 and the proceedings if any would be dropped. 24. Mr. Sharma, the learned A.G.P. may be justified in raising a preliminary objection as regards the very maintainability of the present writ application on the ground that the writ applicant could not have questioned the legality and validity of the intimation issued by the proper officer in Form GST DRC - 01. The blunder committed by the department is at this stage. On one hand, the notice is termed as an intimation of tax ascertained as being payable under sub-section (5) of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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