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

Held

The Court held that while the Circular No. 183/15/2022-GST, dated 27.12.2022, stated it did not apply to completed proceedings, it also clarified that it would apply to cases where adjudication or appeal proceedings were still pending for FY 2017-2018 and 2018-2019. The Court noted that the impugned order was passed on 30.11.2022, and the writ petition was filed on 24.01.2023, which was within the time limit for preferring an appeal under Section 107 of the TNGST Act. Therefore, the writ petition itself could be considered as a pending proceeding. The Court found that relegating the Petitioner to file a formal 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. The Respondent was directed to apply the clarification issued in Circular No. 183/15/2022-GST, dated 27.12.2022, during the fresh determination. The Court also provided specific directions for the re-adjudication process, including listing the matter for a hearing, informing the Petitioner of any required documents, conducting an enquiry with personal hearing if necessary, and passing a reasoned order uninhibited by the previous order.

Facts

The Petitioner, M/s. Atchaya Agencies, represented by its Proprietrix, S. Muneeswari, filed a writ petition challenging an Order-in-Original No. 01/2022 GST, dated 30.11.2022, passed by the Respondent, the Superintendent of CGST & Central Excise. This order assessed liability on the Petitioner for excess Input Tax Credit (ITC) availment 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 the impugned order did not apply a clarification issued by the Central Board of Indirect Taxes and Customs (CBIC) via Circular No. 183/15/2022-GST, dated 27.12.2022, which provided guidance on differences in ITC availed in GSTR-3B versus GSTR-2A for the financial years 2017-2018 and 2018-2019. The Respondent contended that the Circular's instructions applied only to ongoing proceedings and not completed ones, and that the Petitioner's case was a completed proceeding.

Key Issues

1. Whether the clarification issued by the CBIC in Circular No. 183/15/2022-GST, dated 27.12.2022, regarding differences in Input Tax Credit (ITC) availment in GSTR-3B as compared to GSTR-2A for FY 2017-2018 and 2018-2019, applies to the Petitioner's case, which involves an order passed prior to the Circular but where adjudication/appeal proceedings are pending, despite the Circular stating it does not apply to completed proceedings. (Question of law) Petitioner's Contention: The Petitioner argued that the Circular No. 183/15/2022-GST, dated 27.12.2022, should be applied. They highlighted that paragraph 6 of the Circular explicitly states that the instructions will apply to ongoing proceedings and also to cases where adjudication or appeal proceedings are still pending for FY 2017-2018 and 2018-2019. The Petitioner contended that their writ petition, filed within the time limit for appeal under Section 107 of the TNGST Act, constituted pending proceedings. Respondent's Contention: The Respondent resisted the Petitioner's claim by emphasizing Clause 6 of the Circular, arguing that the benefit of the Circular could not be extended to the Petitioner as the impugned order represented a "completed proceeding."