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TMI Blog2022 (3) TMI 1484X X X X Extracts X X X X X X X X Extracts X X X X ..... Solicitor General of India for respondents No.1 to 3; and Mr. K.Raji Reddy, learned Special Standing Counsel for the Commercial Tax Department appearing for respondents No.4 to 6. 2. By filing this petition under Article 226 of the Constitution of India, petitioner seeks quashing of showcause notice dated 23.01.2021, issued by respondent No.5 and further seeks a direction to the respondents for adjustment of the Integrated Goods and Services Tax (IGST) paid by the petitioner towards Central Goods and Services Tax (CGST) and State Goods and Services Tax (SGST) in the State of Telangana. 3. Petitioner is a registered person under the Telangana State Goods and Services Tax Act, 2017 (for short 'the TSGST Act'). It is engaged in the business ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e State of Telangana. Therefore, petitioner was required to pay CGST and SGST. On scrutiny of the returns filed by the petitioner for the year 2018-2019, it was noticed that petitioner had paid IGST of Rs.6,55,70,925.00 instead of CGST and SGST. In the process, there was substantial revenue loss for the State of Telangana. 6. In this connection, a show cause notice was issued by respondent No.5 on 23.01.2021 calling upon the petitioner to pay an amount of Rs.5,98,65,274.00 on account of both CGST and SGST for the period 2018-2019 within fifteen days. The breakup of the aforesaid amount is as under: CGST- Rs.2,99,32,637.00 SGST- Rs.2,99,32,637.00 7. Against the said showcause notice, petitioner has preferred the present writ petition. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct, IGST Act and TGST Act. Because of the action of the petitioner in paying IGST, despite the fact that the transaction involved was an intra-state supply, serious revenue loss has been caused to the State of Telangana. 12. Reference has been made to a decision of the Jharkhand High Court in Shree Nanak Ferro Alloys Pvt. Ltd. V. Union of India W.P(T).No.2246 of 2019 dated 18.12.2019 to contend that petitioner should first pay the outstanding CGST and SGST amount and may seek refund of the IGST amount paid erroneously. 13. Learned counsel for the petitioner has referred to Section 77 of the CGST Act as well as Rule 4(1) of the Refund Rules and submits that by interpreting the aforesaid provisions in a pragmatic manner, a Single Bench of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bsequently held to be an inter-state supply, such registered person shall be refunded the amount of taxes so paid in such manner and subject to such conditions as may be prescribed. 18. Likewise, if a registered person pays IGST on a transaction considered by him to be an inter-state supply, but is subsequently held to be an intra-state supply, such registered person shall not be required to pay any interest on the amount of CGST and SGST. 19. At this stage, we may also refer to Section 19 of the IGST Act, which reads as follows: "19. Tax wrongfully collected and paid to Central Government or State Government:- (1) A registered person, who has paid integrated tax on a supply considered by him to be an inter-state supply, but which is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... upra). 23. On the other hand, we find that in Shree Nanak Ferro Alloys Pvt. Ltd. (1 supra), a Division Bench of the Jharkjand High Court did not agree with similar contention raised before that Court. In that case, Division Bench of the Jharkhand High Court had directed the petitioner to deposit the IGST amount within a period of ten days without any interest; further, holding that the said petitioner would be entitled to refund of the amount paid under the CGST head. 24. That was a case where petitioner had erroneously paid CGST instead of IGST. 25. Thus, upon thorough consideration of the matter, we are of the view that petitioner should comply with the show cause notice dated 23.01.2021 and pay the CGST and SGST amount in terms of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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