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TMI Blog2024 (8) TMI 71X X X X Extracts X X X X X X X X Extracts X X X X ..... Commissioner Grade-2 and Another [ 2024 (7) TMI 1205 - ALLAHABAD HIGH COURT] held that even if excess stock is found, the proceedings under section 130 of the UPGST Act cannot be initiated. The impugned order cannot sustain in the eyes of law and the same is hereby set aside - Petition allowed. - Hon'ble Piyush Agrawal, J. For the Petitioner : Aditya Pandey For the Respondent : C.S.C., Ravi Shanker Pandey, Standing Counsel ORDER HON'BLE PIYUSH AGRAWAL, J. 1. Heard Mr. Aditya Pandey, learned counsel for the petitioner and Mr. Ravi Shanker Pandey, learned Standing Counsel for the State respondents. 2. By means of present writ petition, the petitioner has assailed the order dated 24.03.2022 passed by the respondent no.1 in GST Appea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s perused the record. 7. It is not in dispute that the survey was made on 24.08.2018 in which alleged excess stock was found then the proceedings were initiated. 8. This Court on various occasions has held that if the excess stock was found then the proceedings under Sections 73 74 of the UPGST Act will come into play and not proceedings under Section 130 read with Rule 122 of the Act. 9. Recently, this Court in Writ Tax No. 1007 of 2022 (M/s Shree Om Steels Vs. Additional Commissioner Grade-2 and Another) along with connected cases has held in para nos. 10, 11, 12 13 as under:- 10. The issue in hand is covered by the judgement of this Court in Metenere Limited (supra) , in which following observations have been made:- 22. From the perusal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he is bound to determine the same in accordance with the provisions of Sections 73 74 of the Act. 26. In the present case, the proper officer was empowered to determine the liability of payment of tax in terms of the powers conferred under Section 35 (6) after resorting to the procedure as established under Section 74 of the Act. Section 74 of the Act reads as under: Section 74 - Determination of tax not paid or short paid or erroneously refunded or input tax credit wrongly availed or utilised by reason of fraud or any wilful 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 r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion (1), pay the amount of tax along with interest payable under section 50 and a penalty equivalent to fifteen per cent. of such tax on the basis of his own ascertainment of such tax or the tax as ascertained by the proper officer and inform the proper officer in writing of such payment. (6) The proper officer, on receipt of such information, shall not serve any notice under subsection (1), in respect of the tax so paid or any penalty payable under the provisions of this Act or the rules made thereunder. (7) Where the proper officer is of the opinion that the amount paid under sub-section (5) falls short of the amount actually payable, he shall proceed to issue the notice as provided for in sub-section (1) in respect of such amount which f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the aforesaid case, this Court has specifically held that even if excess stock is found, the proceedings under section 130 of the UPGST Act cannot be initiated. 12. Further, in M/s Maa Mahamaya Alloys Pvt. Ltd. (supra) , this Court has held as under:- 9. Considering the rival submissions made at the bar, the following questions which arise for determination; (I). Whether tax can be assessed/ determined in exercise of powers under Section 130 of the GST Act? (II). Whether penalty can be levied only on the allegations that at the time of verification of goods, the goods in excess were found at the premises? (III). Whether the service of notice as claimed by the respondent satisfies the requirement contemplated under Section 169 of the GST A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by taking recourse under Section 74. 13. As the entire tax has been determined and the penalty has been levied only on the basis of a survey by taking recourse under Section 130 of the GST Act and not taking a recourse to Section 74, the order impugned is clearly unsustainable. 15. On a plain reading of the allegations levelled against the petitioner with regard to the improper accounting of goods, the only stipulation contained in Clauses (ii) and (iv) of subsection (1) of Section 130 can at best be invoked by the department, however, in the present case, even assuming for the sake of argument, that the goods were lying in excess of the goods in record, the case against the petitioner would not fall under Clause (ii) of sub-section (1) of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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