Judgment
IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE DINESH KUMAR SINGH WEDNESDAY, THE 3RD DAY OF APRIL 2024 / 14TH CHAITHRA, 1946 WP(C) NO. 11992 OF 2024 PETITIONER:
AARON CONSTRUCTION CO.
SECOND FLOOR, 61/1137, GOOD NEWS BUILDING, SHARADI LANE, PERUMANOOR P.O., ERNAKULAM REPRESENTED BY ITS MANAGING PARTNER SUSIE PAUL., PIN - 682015 BY ADVS.
K.T.THOMAS MATHEW BOB KURIAN RESPONDENTS:
1 UNION OF INDIA REPRESENTED BY SECRETARY (REVENUE), MINISTRY OF FINANCE, DEPARTMENT OF REVENUE, NORTH BLOCK, NEW DELHI, PIN - 110001 2 STATE OF KERALA REP. BY SECRETARY TO GOVERNMENT, FINANCE DEPARTMENT, SECRETARIAT, THIRUVANANTHAPURAM, PIN - 695001 3 THE SUPERINTENDENT OFFICE OF THE SUPERINTENDENT OF CENTRAL TAX & CENTRAL EXCISE, ERNAKULAM RANGE - I, CENTRAL EXCISE BHAVAN, KATHRIKADAVU, KOCHI, PIN - 682017 BY ADV R.HARISHANKAR SMT. RESHMITA RAMACHANDRAN-GP THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 03.04.2024, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
WPC No.11992 of 2024 2 JUDGMENT Dated this the 3rd day of April, 2024 The present writ petition has been filed impugning Ext.P4 best of judgment assessment order passed under Section 62 of the CGST/SGST Act, by the 3rd respondent.
The petitioner was a registered dealer under the provisions of the CGST/SGST Act, 2017 and Rules made thereunder. The petitioner did not file return for more than a period of six months under Section 39 of the CGST Act, 2017, and therefore, notice under Section 29 read with Rule 22(1)/Sub Rule 22 A was issued to the petitioner. The petitioner was given 30 days time to file reply to the show cause notice. The petitioner submitted reply to the said show cause notice. However, he did not file return within the period of one month. Considering the statutory prescription, the petitioner’s registration got canceled by order dated 21.11.2022.
2. The petitioner was put to notice that the petitioner had not filed the return and despite having got period of
WPC No.11992 of 2024 3 one month to file the return, he did not choose to file the return, as a consequence the registration stood canceled by the order dated 21.11.2022 as mentioned above.
3. Proviso to Sub Rule 4 of Rule 22 also prescribes that if a person instead of filing reply to the notice served under sub-rule (1) for contravention of the provisions contained in clause (b) or clause (c) of sub- section (2) of section 29, furnishes all the pending returns and makes full payment of the tax dues along with applicable interest and late fee, the proper officer shall drop the proceedings and pass an order in FORM GST-REG 20.
4. Section 62 of the CGST Act, provided for best of judgment assessment in case of non-filers of return by the persons. Section 62 on reproduction, would read as under:
“Assessment of non-filers of returns.— (1) Notwithstanding anything to the contrary contained in section 73 or section 74, where a registered person fails to furnish the return under section 39 or section 45, even after the service of a notice under section 46, the proper officer may proceed to assess the tax liability of the said person to the best of his judgement taking into account all
WPC No.11992 of 2024 4 the relevant material which is available or which he has gathered and issue an assessment order within a period of five years from the date specified under section 44 for furnishing of the annual return for the financial year to which the tax not paid relates. (2) Where the registered person furnishes a valid return within thirty days of the service of the assessment order under sub-section (1), the said assessment order shall be deemed to have been withdrawn but the liability for payment of interest under sub-section (1) of section 50 or for payment of late fee under section 47 shall continue.” 5. Section 63 is in respect of the assessment of unregistered persons. sub-section 1 of Section 63 provides that, if a person, after service of notice, fails to furnish return, the proper officer may proceed to assess the tax liability of the said person to the best of his judgment.
Sub-Section 2 further gives one opportunity to persons who have not filed the return and where the best of judgment assessment has been carried out to get the best of judgment assessment canceled, to file the return within a period 30 days of the service of the assessment order.
6. In the present case, the petitioner does not deny that he was put to notice regarding non-filing of his
WPC No.11992 of 2024 5 return in Ext.P2, though the said notice was issued under Section 29 of CGST Act read with Rule 22. The substance of the provision is, the notice to the non-filer to file the return. If, despite having notice of not filing the return, the dealer choose not to file the return. The procedure for the best of judgment assessment has to be adopted under Section 62 of the CGST Act.
7. In the present case, it is not in dispute that the petitioner was also served with best of judgment assessment and despite the best of judgment assessment having been served, the petitioner choose not to file his return. Thus, the petitioner had acted in violation of the law and had approached this Court on a very technical issue. This Court does not find any substance to grant any relief to the petitioner, who himself has acted in violation of the law and despite two opportunities having been given to him to file return, he failed to file the return.
WPC No.11992 of 2024 6 In view thereof, I finds no substance in this writ petition. Therefore, the present writ petition is hereby dismissed.
Sd/-
DINESH KUMAR SINGH JUDGE AP
WPC No.11992 of 2024 7 APPENDIX OF WP(C) 11992/2024 PETITIONER EXHIBITS Exhibit-P1 TRUE COPY OF THE REGISTRATION CERTIFICATE NO.32ABQFA1292F1ZL DATED 25.01.2020 ISSUED BY THE GOVERNMENT OF KERALA Exhibit-P2 TRUE COPY OF THE SHOW CAUSE NOTICE DATED 05.01.2022 ISSUED BY SUPERINTENDANT, CTO WORKS CONTRACT OFFICE, ERNAKULAM Exhibit-P3 TRUE COPY OF THE ORDER DATED 21.11.2022 ISSUED BY SUPERINTENDANT, CTO WORKS CONTRACT OFFICE, ERNAKULAM Exhibit-P4 TRUE COPY OF THE ASSESSMENT ORDER DATED 16.05.2023 ISSUED BY THE 3RD RESPONDENT Exhibit-P5 TRUE COPY OF THE DEMAND NOTICE DATED 12.01.2024 ISSUED BY 3RD RESPONDENT