9911796707
TMI Blog2024 (10) TMI 1608X X X X Extracts X X X X X X X X Extracts X X X X ..... s accordingly disposed of. - HONOURABLE MR. JUSTICE BHARGAV D. KARIA AND HONOURABLE MR. JUSTICE D.N.RAY Appearance: For the Petitioner(s) No. 1: Mr Bhavesh B Chokshi (3109) For the Respondent(s) No. 1,2: Mr Utkarsh R Sharma (6157) ORAL JUDGMENT (PER : HONOURABLE MR. JUSTICE BHARGAV D. KARIA) 1. Heard learned advocate Mr. Abhishek Rastogi for learned advocate Mr. Bhavesh Chokshi for the petitioner and learned advocate Mr. Utkarsh Sharma for the respondents. 2. By way of this petition under Article 226 of the Constitution of India, the writ applicant has approached this Court with the following reliefs: a. issue an appropriate writ of mandamus or any other writ, order or direction quashing and setting aside the impugned Letter dated 25.04.2023 (Annexure B) insofar as it has been issued arbitrarily and in violation of Article 14 of the Constitution; b. direct respondents to consider the amount of INR 3,36,82,000/- paid by the petitioner company, towards the mandate of pre-deposit, vide Form GST DRC 03 dated 09.02.2021 and 26.12.2022 is sufficient compliance of section 107 (6) (b) of the CGST Act and corresponding provisions of the IGST Act; c. pending final hearing and disposal of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cted at the premises of the petitioner-company. Thereafter, after recording the statement of Director of the company and upon completion of the investigation, a show cause notice dated 16.03.2022 was issued demanding the refunded IGST in terms of section 16 (3) (b) of the IGST Act along with interest and penalty. 3.6 The petitioner vide detailed reply dated 23.05.2022 and personal hearings dated 19.07.2022 and 10.08.2022 submitted that the matter was revenue neutral, reversal of IGST exemption for the period from October 2019 to September, 2021 had been effectuated in absence of any contravention of Rule 96 (10) of CGST Rules. However, the respondents vide order dated 20.09.2022 had confirmed the show cause notice dated 16.03.2022 demanding of tax, penalty and interest. 3.7 Aggrieved by the aforesaid order, the petitioner had preferred appeal before the Commissioner (Appeals) bearing No. 11/GST/CP/22-23 and also deposited the pre-deposit amount to the tune of Rs. 3,36,82,000/- in compliance of section 107 (6) (b) of the CGST Act utilizing the amount available in the Electronic Credit Ledger vide Form GST DRC-03 dated 26.12.2022. However, the respondent No. 2 vide impugned letter 25 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e in the cash ledger. 10. Moreover, Sub-section (4) of Section 49 provides the amount available in the Electronic Credit Ledger may be used for making any payment towards output tax under the MGST Act or IGST Act subject to certain restrictions or conditions that may be prescribed. Sub-rule (2) of Rule 86 of MGST Rules provides for debiting of the Electronic Credit Ledger to the extent of discharge of any liability in accordance with the provisions of Section 49 of the MGST Act. Further, output tax in relation to a taxable person is defined in Clause (82) of Section 2 of MGST Act as the tax chargeable on taxable supply of goods or services or both but excludes tax payable on reverse charge mechanism. Therefore, any payment towards output tax, whether self-assessed in the return or payable as a consequence of any proceeding instituted under the MGST Act can be made by utilisation of the amount available in the Electronic Credit Ledger. Hence, a party can pay 10% of the disputed Tax either using the amount available in the Electronic Cash Ledger or the amount available in the Electronic Credit Ledger. Ms. Chavan relied upon an order of the High Court of Orissa at Cuttack in M/s Jyoti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... instituted under the provisions of GST Laws, can be made by utilization of the amount available in the electronic credit ledger of a registered person. 5. It is further reiterated that as output tax does not include tax payable under reverse charge mechanism, implying thereby that the electronic credit ledger cannot be used for making payment of any tax which is payable under reverse charge mechanism. 7 Whether the amount available in the electronic credit ledger can be used for making payment of any liability other than tax under GST Laws? As per sub-section (4) of section 49, the electronic credit ledger can be used for making payment of output tax only under the CGST Act or the IGST Act. It cannot be used for making payment of any interest, penalty, fees or any other amount payable under the said acts. Similarly, electronic credit ledger cannot be used for payment of erroneous refund sanctioned to the taxpayer, where such refund was sanctioned in cash. 8. Whether the amount available in the electronic cash ledger can be used for making payment of any liability under the GST Laws? As per sub-section (3) of Section 49 of the CGST Act, the amount available in the electronic cash le ..... X X X X Extracts X X X X X X X X Extracts X X X X
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