M/S S V Halavagali And Sons vs. The Superintendent - Karnataka High Court, 03 November 2023

Cause title — parties, addresses and appearances

- 1 - NC: 2023:KHC-D:12831 WP No. 102048 of 2023 IN THE HIGH COURT OF KARNATAKA, DHARWAD BENCH DATED THIS THE 3RD DAY OF NOVEMBER, 2023 BEFORE THE HON'BLE MR JUSTICE ANANT RAMANATH HEGDE WRIT PETITION NO. 102048 OF 2023 (T-RES) BETWEEN: M/S S V HALAVAGALI AND SONS R/BY ITS PARTNER SHRI SHIDLINGAPPA S/O CHANDRAKANTH HALAVAGALI, AGE 53 YEARS, R/O NAMJOSHI ROAD, GADAG 582101. …PETITIONER (BY SRI. H R KAMBIYAVAR, ADVOCATE) AND: 1. THE SUPERINTENDENT OF CENTRAL EXCISE, ‘A’ RANGE, BULLA BUILDING, GUJJARA BASADI, MAIN ROAD, GADAG 582103. 2. THE PRINCIPAL CHIEF COMMISSIONER OF CENTRAL TAX 1, QUEENS RD, VASANTH NAGAR, BENGALURU, KARNATAKA 560001. 3. THE PRINCIPAL ADDITIONAL DIRECTOR GENERAL OF SYSTEMS AND DATA MANAGEMENT, GST AND CENTRAL EXCISE GST BHAVAN, NO 26/1, MAHATHMA GANDHI ROAD, NUNGAMBAKKAM, CHENNAI -34, TAMILNADU. 4. THE ASSISTANT COMMISSIONER OF COMMERCIAL TAXES, MOHANKUMAR B SHELAR Digitally signed by MOHANKUMAR B SHELAR Date: 2023.11.07 15:48:04 +0530 - 2 - NC: 2023:KHC-D:12831 WP No. 102048 of 2023 LGSTO-350, GADAG, 2ND FLOOR, NISARGA BUILDING, MULGUND ROAD, GADAG -582103. …RESPONDENTS (BY SRI.SHIVARAJ S BALLOLI, ADVOCATE FOR R1 TO R3; SRI.SHIVAPRABHU HIREMATH, AGA FOR R4) THIS WP IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA, PRAYING THIS HON’BLE COURTI TO I) ISSUE WRIT OF CERTIORARI OR IN THE LIKE NATURE OF CERTIORARI QUASHING THE IMPUGNED ORDER BEARING NO. BEL-CGST-000-DWD-SUP-SHJ-02-2022-23-GST- TRAN-1 DATED 20.02.2023, PASSED BY RESPONDENT NO. 1 VIDE ANNEXURE-K; II) ISSUE WRIT OF MANDAMUS OR IN THE LIKE NATURE OF MANDAMUS OR DIRECTION TO THE RESPONDENT NO. 1, TO CONSIDER THE REPLY DATED 13.02.2023 VIDE ANNEXURE-J. THIS PETITION, COMING ON FOR HEARING ON INTERLOCUTORY APPLICATION, THIS DAY, THE COURT MADE THE FOLLOWING:

ORDER

Heard learned counsel appearing for the petitioner and the learned counsel appearing for the respondents.

The petitioner is assailing the order dated 20.02.2023 passed by respondent No.1-Superintendent of Central Excise, Gadag and has also sought a direction against respondent No.1 to consider the reply dated 13.02.2023. NC: 2023:KHC-D:12831

The petitioner is a partnership firm registered under the Goods and Services Tax Act, 2017. The petitioner is engaged in supply of goods coming under the Chapter 8432, 31010010 and 10091090. Respondent No.1 has issued show cause notice dated 09.12.2022 on the premise that GST returns submitted by the petitioner were the subject matter of scrutiny and sought explanation from the petitioner.

The petitioner has replied to the said notice and claimed CENVAT Credit of Central Excise duty on the stock of goods held on 30.06.2017, for Rs.6,18,796/-. Pursuant to the reply, hearing was fixed on 24.01.2023. Petitioner further claims that he has produced additional documents in support of his defence. Thereafter respondent No.1 issued one more notice dated 06.02.2023 on the premise that the petitioner has filed TRAN-1 claim under Table 7(d) in terms of Rule 117(4) of Central Goods and Services Tax Rules, 2017 and took a view that the petitioner is not entitled to CENVAT credit.

It is the case of the petitioner that he made a claim under column ‘7(d)’ inadvertently, instead of making a TRAN-1 NC: 2023:KHC-D:12831 claim under column ‘7(b)’. The petitioner however submits that error is inadvertent and he has the documents to support his claim for necessary credit under the Head ‘7(b)’.

Learned counsel for the respondents would submit that the impugned order is available under Section 107 of CGST Act.

Learned counsel for the petitioner in reply would contend that the Madurai Bench of Madras High Court has dealt with similar issue where the claim is inadvertently made under the inapplicable head and the Writ Court entertained the petition and issued a direction to the respondent-Authority to verify the claim of the petitioner and if the claim is found to be supported by materials, to grant necessary relief as available under law. This Court has perused the aforementioned judgment.

From the aforementioned judgment, in W.P.(MD) No.15531/2020 and W.M.P.(M.D.) NO.13042/2020, it can be noticed that in the said case, the claim was made under Column 7(d) of the Form instead of 7(a) and while allowing the writ petition, the Court directed the respondents to forward the NC: 2023:KHC-D:12831 petitioner’s application to the concerned authority and directed the concerned authority to verify the correctness of the claim made and it further directed that if satisfied with respect to the claim, the authority shall grant the relief sought in the writ petition.

This Court has also perused the records in the case. The petitioner makes claim that he ought to have filed returns under by making a claim under Column 7(b) and erroneously he made a claim under Column 7(d). Since the petitioner has claimed that he has necessary invoices and documents to support his claim under column ‘7(b)’, this Court is of the view that the impugned order is to be set aside and matter is remitted to respondent No.1. 10. Respondent No.1 shall consider the claim of the petitioner under Column 7(b) of CGST Rules, 2017, if there are supporting documents to make claim under Column 7(b). If the claim is established then the consequential relief should follow.

11.

With the above observations, petition is disposed of. NC: 2023:KHC-D:12831

12.

It is made clear that this Court has not expressed any opinion on the merits of the claim of the petitioner. The authority shall consider the merits of the claim of the petitioner in accordance with law.

13.

Annexure-K is set aside, and consequential order Annexure-L notice issued pursuant to Annexure-K is also set aside.

14.

Respondent No.1 shall process petitioner’s claim within three months from the date of receipt of a copy of this order. JUDGE

KGK List No.: 1 Sl No.: 13