M/S.Muthukumar Medical Agencies vs. The Superintendent Of CGST And Central Excise

Held

The Court held that while the circular explicitly stated it would not apply to completed proceedings, it also clarified that it would apply to cases where adjudication or appeal proceedings are still pending. The Court noted that the impugned order was passed on December 9, 2022, and the writ petition was filed on February 22, 2023, which was within the three-month period for filing an appeal under Section 107 of the TNGST Act. Therefore, the proceedings were considered pending. The Court found that relegating the Petitioner to file an appeal would be an empty formality and would unnecessarily protract the proceedings. To meet the ends of justice, the Court decided to set aside the impugned order and remit the matter back to the Respondent for fresh determination, with a direction to apply the clarification issued in Circular No. 183/15/2022-GST dated December 27, 2022. The Court also provided detailed procedural directions for the fresh determination, including affording the Petitioner an opportunity for personal hearing and passing a reasoned order.

Facts

The Petitioner, M/s. Muthukumar Medical Agencies, filed a writ petition challenging an Order-in-Original dated December 9, 2022, passed by the Superintendent of CGST & Central Excise. This order assessed liability on the Petitioner for excess Input Tax Credit (ITC) availed for the financial year 2017-2018 and imposed a penalty under the Tamil Nadu Goods and Services Tax Act, 2017. The Petitioner's grievance was that a subsequent Circular No. 183/15/2022-GST, dated December 27, 2022, issued by the Central Board of Indirect Taxes and Customs (CBIC), which provided clarification on dealing with differences in ITC availed in GSTR-3B versus GSTR-2A for 2017-2018 and 2018-2019, was not applied to their case. The impugned order was passed before this circular.

Key Issues

1. Whether the clarification issued by CBIC Circular No. 183/15/2022-GST dated 27.12.2022, which applies to ongoing proceedings and pending adjudication or appeal proceedings for FY 2017-2018 and 2018-2019, can be applied to the Petitioner's case, despite the Respondent contending it is a completed proceeding? Petitioner's arguments: The Petitioner contended that the impugned order, though passed before the circular, should be reconsidered in light of the subsequent clarification. They argued that the writ petition was filed within the time limit prescribed for appeal under Section 107 of the TNGST Act, and relegating them to an appeal would be an empty formality. Respondent's arguments: The Respondent resisted the Petitioner's claim by highlighting Clause 6 of the circular, which stated that the instructions would apply only to ongoing proceedings and not to completed proceedings, arguing that the Petitioner's case was a completed proceeding.