M/S. S.W. Iron Works PVT. LTD And Anr. vs. The State Of West Bengal And Ors.

Facts

The petitioners, M/s S.W. Iron Works Pvt. Ltd. & Anr., filed a writ application challenging an order dated January 31, 2024, passed by the appellate authority under Section 107 of the WBGST & CGST Act, 2017. The petitioners argued that they had already paid the entire penalty under Section 129(1)(a) of the Act. They contended that the demand confirmed by the appellate authority could not be enforced until the appellate tribunal, to be constituted under Section 112 of the Act, became operational. The petitioners sought to withdraw their writ application with liberty to approach the appellate tribunal upon its constitution. The State did not oppose this prayer, but requested an undertaking from the petitioners to file an appeal before the Tribunal when it is constituted.

Held

The Court, having heard the learned advocates for both parties and taking note of the guidelines circulated by the Principal Commissioner (GST) dated July 11, 2024, granted liberty to the petitioners to withdraw the writ application. This liberty was made conditional upon the petitioners filing an undertaking within a period of three weeks from the date of the order. The undertaking is to be in terms of paragraph 5 of the aforementioned notification. The Court held that if no such undertaking is filed within the stipulated time, the benefit of this order would not enure to the petitioners. The petitioners are at liberty to approach the appellate tribunal as and when it is constituted under Section 112 of the said Act. The writ application was accordingly disposed of.

Key Issues

1. Whether the demand confirmed by the appellate authority under Section 107 of the WBGST & CGST Act, 2017, can be enforced when the petitioners have already paid the entire penalty under Section 129(1)(a) of the said Act, and the appellate tribunal under Section 112 is yet to be constituted? Petitioner's contention: The petitioners argued that the enforcement of the demand confirmed by the appellate authority should be stayed at least until the constitution of the appellate tribunal. They relied on a notification dated July 11, 2024, issued by the Principal Commissioner (GST). They sought to withdraw the writ application with liberty to approach the tribunal upon its constitution. Revenue's contention: The State did not oppose the withdrawal of the writ application. However, they submitted that the petitioners should file an undertaking with the jurisdictional proper officer, declaring their intention to file an appeal before the Tribunal as and when it becomes operational, within the timeline specified in Section 112 of the Act.