BharatTaxGST

M/S. Synergy Measurement Technologies PVT LTD vs. Union Of INDIA

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WP/24508/2022HC TelanganaGSTCNR HBHC01033876202220 July 2022Bench: SUREPALLI NANDA,UJJAL BHUYAN7 pages
For Petitioner: SRl. M.V.J.K. KUMARFor Respondent: SRI NAMAVARAPU RAJESHWARA RAO, ASSISTANT SOLICITOR GENERAL

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Cause title — parties, addresses and appearances
HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD (Special Original Jurisdiction) WEDNESDAY, THE TWENTIETH DAY OF JULY TWO THOUSAND AND TWENTY TWO PRESENT THE HONOURABLE THE CHIEF JUSTICE UJJAL BHUYAN AND THE HONOURABLE MRS JUSTICE SUREPALLI NANDA WRIT PETITION NO: 24s08 OF 2022 Between: A//s. Syqergy [\rleasurement Technologies Pvt. Ltd., 10-2-157, Plot No.41 , Ram Nivas, '1'' Floor, Road No.2, West lvlarredpally, Secunderabad - 500 026, Telanqana State, lndia, Rep By its Authorized Signatory, Sri- Vincent George, S/o. -N.C. George, Aged about 66 Years. AND ...PET|TIONER 1. Unlon of lndia, Ministry of Law and Justice Through its Secretary, 4th Floor, A-Wing, Shastri Bhawan, New Delhi 1 '10001. 2. The State of Telangana, Rep. by its Principal Secretary to Revenue(CT) Dept., Secretariat Building, Hyderabad, Telangana. 3. The Appellate Joint Commissioner of State Tax, Punjagutta Division, 5th Floor, C.T. Complex, Nampally, Hyderabad. 4. The Assistant Commissioner, (State Tax) Maredpally Circle, Begumpet Division, 6th Floor, Pavani Prestige Buildings, Ameerpet, Hyder,bad. ...RESPONDENTS Petition under Article 226 of the Constitution of lndia praying that in the circumstances stated in the affidavit filed therewith, the High Court may be pleased to issue an appropriate writ, order or direction particularly in the nature of Writ of MANDAMUS declaring para 3.2 of Circular No.1 35/2020-GST dated 3'l -03- 2020 (Annexure-P2) amounting to executive legislation in so far as the disq ualification mentioned therein for being read between lines in Section 54(3)(ii) of CGST Act 2017 as illegal, arbitrary, without authority of law, without jurisdiction and contrary to section 54(3xii) of the CGST Act 2017 and consequenfly to set aside the impugned orders of the 3rd and 4th respondents dated 18-04-2022 in Appeal No. AD360221O40386F affirming the orders of the 4t respondent dated 23-11-2O2O in Ref.MPLYe/36AAKCS395OJ122|02 (Annexure-Pl) and direct the 4th respondent to refund the amount of Rs.28,99,0161 along with interest as provided in section 56. I I I il2il IA NO: 1 OF 2022 Petition under Section 151 cPC praying that in the circumstances stated in the affidavit filed in support of the petition, the High court may tre pleased to direct the 1.t respondent to refund 50% of the amount pending dsposal of the writ petition. Counsel for the Petitioner: SRl. M.V.J.K. KUMAR Counsel for the Respondent No.1: SRI NAMAVARAPU RAJESHWARA RAO, ASSISTANT SOLICITOR GENERAL Counsel for the Respondent Nos.2 to 4: SRI L. VENKATESW\R RAO' SENIOR S.C. FOR COMMERCIAL TAX

The Court made the following: ORDER I I i

THE HON'BLE THE CHIEF JUSTICE UJJAL BHUYAN AND THE HON'BLE MRS JUSTICE SUREPALLI NANDA WRIT PETITION No.245O8 of 2022 ORDER: eer the Han'bte the Chief Justice UJJat Bhuyan) Heard Mr. M.V.J.K.Kumar, learned counsel for the petitioner and Mr. L.Venkatesu,ar Rao, Iearned counsel lor

2.

By filing this petition under Article 226 of the Constitution of India, petitioner seeks a declaration that para 3.2 of Circular No.135/05/2020-GST, dated 31.03.2020, ol the Central Board of Indirect Taxes and Customs (briefly, 'the Board' hereinafter) is ultra uires Section 54(3)(ii) of the Central Goods and Services Tax Act, 2Ol7 (brief1y, 'the CGST Act'hereinafter). Petitioner further seeks a direction to rcspondent No.4 for refund of Rs.29,89,O 16.00 with interest in terms of Section 54 of the CGST Act.

3.

Notice in this case was issued on 08.06.2022. rcspondents No.2 to 4. l l i I

4' ' [r tire hcaring ro,la.r'. fuir. L.ve k,teswara Ra,J. learned counsel for r.cspondents No.2 ro 4 has placecl before us a copy of Circular No.1T3 /05 i2022_GST, clateti 06 .O7 .2C22, of the Boarcl. As p{jr thc sild c:rrc,-rlar, it tias been clar-ified that in cases where the supptier is making supply ol qoods under a concessiollal nctification and the rate of tax of output suppl.y is less than the rate of tax on input supply (of the same goods) at the same point of time due to sr.rp;-,ly of goods bJ, th. supplier u'der such concessional notification, refund of accurlulated input tax credit or.l accourlt of inverlecl structure as per ciause (ii) of sub-section (3) of Section 54 of the CGST Act r.r.,ou1d be allowed in those cases where accumulation cf input tax credit is on account of rate of ta_x on outrvard supoty being less than the rate of tax on inputs (same goods) at the same point of time, as per some concessional notification issued by the Government providing for iower rate ol_ tax for some specified supplies subject to fulfilment of other conditions. As per the said circurar para 3.2 of the circurar No.135/05/2020-cST, dated 31.03.2020, has been substituted in the following m€rnner:_

"3.2 It mag be noted that refund' of acanmulated (tC in terms of clause (it) of Jirst prouiso to sub'section (3) of section 54 of the CGS? Act is auailoble tuhere the credit has aca)mulotecl on account of rote of tox on inputs being higher than the rate of tox on output supplies' /t is noteLuorth1 tLnt, the input and output being the same in such cases, tllough ottracting different tax rates dt different points in time' do not get couered under the prouisions of clause (ii) of the frst prouiso to sub-section (3) of section 54 of the CGST Act'

3.

3 There may houeuer, be cases uhere though inputs and output goods are some but the output supplies are mad.e under a concessional notiftcation due to uthich tl-Le rate of tax on output supplies is less than the rote of tax on inputs. In such cases, as the rate of tax of output supptg is less than the rate of tax on inputs at the same point of ttme due to supptg of goods bg the supplier under such concessio nal notification, the credit ocanmtlated on account of the same is admissible for refund under the prouisions of clause (ii) of the first proui'so to sub-section (3) of section 54 of the CGST Act, other than th'e cases uhere output supplY is either Nil rated or fullg exempted' and. also prouided that supplA of such goods or seruices are not nottfied bA the Gouemm'ent for their exclusion from refun-d of acanmulated IIC under tLrc said clause'"

5.

In view of the aforesaid development, lea-rned counsel for respondents No'2 to 4 submits, on the basis of written instructions, that petitioner would be etigible for refund I I I I I \ I I I

+ \ ald therefore, the case of the petitioner for refund rvould be processed

6.

Having regard to the above, respondent No.4 is directed to process the claim of refund of the petitioner in terms of Section 54 of the CGST Act. The said exercise shall be completed within a period of eight weeks from the date of receipt of a copy of this order.

7.

This disposes of the rvrit petition B. Miscelianeous applications pending, if any, shall stald closed. However, there shall be no order as lo costs. K.ONESIM DEPUTY REGIVTRAR ///t ,*fr{ SECTIONOFFICER To,1. The Assistant Commissioner, (State Tax) tMaredpally Circle, Begumpet ' Division, 6th Floor, Pavani Prestige Buildings, Ameerpet, l-lyderabad.

2.

One CC to SRI M.V.J.K. KUIT4AR Advocate [OPUC]

3.

One CC to Sri Namavarapu Rajeshwara Rao, Assistant Solicitor General loPUCl

4.

One CC to Sri L. Venkateswar Rao, Senior S.C. for Commercial Tax [OPUC]

5.

Two CD Copies

6.

One Spare Copy CHR "h'--- I i

HIGH COURT DATED:2010712022 ORDER W.P.No.24508 of 2022 DISPOSING OF THE WRIT PETITION WITHOUT COSTS 'l 1v\t-- STAI( 1 r 5Ef ?',22 I \\ N \,/

Reproduced from the public record of the Telangana High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.