2022 (10) TMI 994

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..... sions of Central Goods & Services Tax Act, 2017, and is having registration number. 2. The petitioner lends money to its customers for various purposes including to purchase the vehicles. In order to secure its loans, the petitioner obtains collateral security in form of movable and immovable securities, which are either mortgaged, pledged or hypothecated. 2.1 By filing this petition under Article 226 of the Constitution, the petitioner has prayed, (i) to declare proviso to Rule 32(5) of the Central Goods and Services Tax Rules, 2017, and proviso to Rule 32(5) of the Gujarat Goods and Services Tax Rules, 2017, to be arbitrary and discriminatory as it distinguishes between a registered borrower and unregistered borrower. (ii) It is fur .....

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..... ch goods by the defaulting borrower reduced by five percentage points for every quarter or part thereof, between the date of purchase and the date of disposal by the person making such repossession. 3.1 The notification dated 25.01.2018 deals with effective rates of CGST on old and used motor vehicles. The relevant is the description of goods in Tariff Entry No. 8703 and Tariff Entry No. 87, which prescribes the rate for old and used motor vehicles. The explanation to the said notification reads as under, "Explanation - For the purposes of this notification, - (i) in case of a registered person who has claimed depreciation under section 32 of the Income-Tax Act,1961(43 of 1961) on the said goods, the value that represents the margin of .....

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..... comes clear that whether the borrower is registered borrower or unregistered borrower, the result to ensue has to be same and there cannot be any distinction in respect of GST liability. It was submitted that the petitioner is penalised for the reason that the borrower may be unregistered person. 5. There is prima facie substance in the submissions and contentions raised on behalf of the petitioner. 6. Notice returnable on 16.11.2022. 7. In order to avoid irreversible situation, in the event the petitioner succeeds in the petition, interim relief deserves to be granted. By way of ad interim relief, it is directed that the competent authority of the respondent shall not take any further steps pursuant to the impugned show-cause notice.

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