Sri Kasthuri Rice Mill vs. The Assistant Commissioner (State Taxes)
Held
The Court allowed the Writ Petition in terms of a previous order passed by a Division Bench of the same High Court in W.P.No.45971 of 2018, dated 20.11.2020. The previous order had set aside the levy of GST on the value of by-products (broken rice, bran, and husk) treated as part of the consideration for milling paddy. By allowing the present petition in terms of the prior order, the Court implicitly held that the levy of GST on custom milling charges, as challenged by the petitioner, was also not sustainable. The reasoning is based on the precedent established in the earlier case. The operative direction was to allow the Writ Petition. No issue was expressly left undecided.
Facts
The petitioner filed a Writ Petition seeking to set aside an order dated 24.09.2019 passed by the 1st Respondent for the period July 2017 to November 2018. The petitioner challenged the levy of GST on custom milling charges received from the 2nd Respondent Corporation, arguing it was illegal, arbitrary, and in violation of natural justice. The petitioner sought a declaration that they are not liable for GST on these charges, or alternatively, that the 2nd Respondent should bear the liability. The 1st Respondent is the authority that passed the impugned order. The amount in dispute is not explicitly stated but pertains to GST on custom milling charges.
Key Issues
1. Whether the levy of GST on the value of custom milling charges received by the petitioner from the 2nd Respondent Corporation is illegal, arbitrary, and contrary to law, violating principles of natural justice and jurisdiction? Petitioner's arguments: The petitioner contended that the order passed by the 1st Respondent is illegal, arbitrary, and contrary to law, violating principles of natural justice and jurisdiction. They sought to be declared not liable for GST on custom milling charges. Revenue's arguments: The judgment records that learned counsel on both sides submitted that the issue involved is squarely covered by a previous order of this Court in W.P.No.45971 of 2018. No specific arguments were recorded for the revenue beyond this submission.
AI-generated summary — verify with the full judgment below
THE HONOURABLE SRI JUSTICE C.PRAVEEN KUMAR AND THE HONOURABLE SRI JUSTICE R.RAGHUNANDAN RAO WRIT PETITION No.19417 OF 2019
ORDER:- (Per Hon’ble Sri Justice C.Praveen Kumar)
The present Writ Petition came to be filed under Article 226 of the Constitution of India seeking the following relief:- “……..to issue a Writ of Mandamus or any other appropriate Writ or order or direction, setting aside the order of the 1st Respondent dated 24.9.2019 for the period July, 2017 to November, 2018 (State GST), as illegal, arbitrary and contrary to law, in gross violation of principles of natural justice and without authority of law and jurisdiction, and set aside the same and consequently declare that the Petitioner is not liable to GST on the value of custom milling charges received from the 2nd Respondent Corporation, or in the alternative, direct the 2nd Respondent Corporation to bear the liability if it is held to be payable, and pass….”
Heard Sri K.Srinivasa Rao, learned counsel for the petitioner, learned Government Pleader for Commercial Taxes appearing for respondent Nos.1 and 4, Sri P.Hemachandra, learned Standing Counsel appearing for respondent Nos.2 a
The judgment continues below.
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