M/S. Aarwin Engineering Projects Services Private Limited vs. The Deputy Assistant Commissioner (St)

Held

The Court allowed the writ petition. It held that since the receipt of Rs. 30,78,804/- by the respondent authority was admitted, it was appropriate to direct the respondent to carry out the necessary entries in their records to credit this sum against the tax due from the petitioner. The Court reasoned that the initial payment, though potentially made under a non-standard form, had been received by the revenue, and the subsequent demand for the same amount was therefore unjustified. The Court set aside the demand notice dated May 17, 2024 (RC.No.18/2024/AEO-III) issued by the respondent. The respondent was directed to complete the necessary accounting adjustments within four weeks from the receipt of the order. No issue was expressly left undecided.

Facts

The petitioner, M/s. Aarwin Engineering Projects Services Private Limited, was assessed for tax for the period April 2020 to September 2020 and paid all dues. Subsequently, on January 27, 2021, the petitioner received a demand notice for Rs. 30,78,804/- as interest on belated payment, which was paid by a vendor. On July 17, 2024, the petitioner received a fresh demand notice for the same amount for the same tax period. The petitioner approached the High Court, contending that the amount had already been cleared and a second notice was unwarranted. The revenue admitted the receipt of Rs. 30,78,804/- but stated it was not paid under the appropriate form GST DRC-07, leading to incorrect credit entry and the subsequent demand.

Key Issues

1. Whether the second demand notice dated July 17, 2024, for Rs. 30,78,804/- issued by the Deputy Assistant Commissioner is sustainable in law, given that the amount was already paid and acknowledged by the respondent, turning on the principles of double jeopardy and proper accounting of payments under the GST Act. Petitioner's contentions: The petitioner argued that the second demand notice was invalid as the amount had already been paid and cleared. Issuing a second demand for the same amount constituted an error by the respondent authority. Respondent's contentions: The respondent (Deputy Assistant Commissioner) admitted receipt of Rs. 30,78,804/- via Demand Draft No. 138686 dated February 11, 2021. However, they contended that the payment was not made under the appropriate form GST DRC-07. This procedural lapse in filing resulted in the amount not being correctly credited to the petitioner's account, necessitating the issuance of the second demand notice.