M/S. Gjs Infratech PVT. LTD And Another vs. Union Of INDIA

Facts

The petitioners, M/s. GJS Infratech Pvt. Ltd and its Managing Director, Jangam Gopi, filed a writ petition challenging the coercive actions of the respondents, including summoning for oral evidence and compelling remittance of alleged tax dues under threat of arrest. The petitioners contended that these actions were arbitrary and violative of their constitutional rights, as the respondents had not followed the assessment procedures under Sections 73 and 74 of the CGST Act, 2017. They sought a direction for the respondents to act in accordance with the law and refrain from coercive measures until the assessment was completed. The petitioners also filed interim applications seeking permission to appear with counsel during inquiries and to prevent coercive action pending the writ petition's disposal.

Held

The Court recorded the statement made by the learned counsel for the respondents that the Spot Summons dated 24-09-2020 issued by the 6th respondent would be withdrawn and superseded by the issuance of new summons by the Competent Authority under the CGST Act, 2017. Based on this submission, the Court dismissed the Writ Petition. It was made clear that all contentions of the petitioners and respondents were left open to be raised in the event the petitioner had any grievance against the fresh summons to be issued by the Competent Authority. No costs were awarded. The Court did not decide on the merits of the petitioners' claims regarding the alleged arbitrary action or the violation of constitutional rights, as the matter was disposed of based on the respondents' undertaking to issue fresh summons.

Key Issues

1. Whether the respondents' action of summoning the petitioners for oral evidence and compelling remittance of alleged tax dues under threat of arrest, without first proceeding with assessment under Sections 73 and 74 of the CGST Act, 2017, is arbitrary, unreasonable, and violative of Articles 14 and 21 of the Constitution of India? Petitioner's arguments: The petitioners argued that the respondents were acting coercively and bypassing the mandatory assessment procedures laid down in Sections 73 and 74 of the CGST Act, 2017. They contended that such actions were unconstitutional and sought a writ of mandamus to direct the respondents to follow the due process of law. They also sought to appear with their counsel during inquiries under Section 70 of the CGST Act, 2017. Revenue's arguments: The respondents stated that the Spot Summons dated 24-09-2020 issued by the 6th respondent would be withdrawn and superseded by new summons issued by a Competent Authority under the CGST Act, 2017.