M/S. Benit And Co., Electronics (P) LTD vs. The Superintendent (Audit) Team-1

Held

The Court held that while the impugned order was passed before the issuance of Circular No. 183/15/2022-GST, the writ petition was filed within the period prescribed for filing an appeal under Section 107 of the TNGST Act. Therefore, the proceedings could be considered pending for the purpose of applying the circular. The Court found that relegating the petitioner to the appellate authority would be an empty formality and would unnecessarily protract the proceedings. To meet the ends of justice, the Court set aside the impugned order and remitted the matter back to the Third Respondent (Deputy Commissioner) for fresh determination. The Third Respondent was directed to apply the clarification issued in the CBIC Circular dated 27.12.2022, conduct an enquiry, provide an opportunity for personal hearing if necessary, and pass a reasoned order uninhibited by the previous order.

Facts

The petitioner, M/s. Benit & Co. Electronics (P) Ltd., challenged an Order-in-Original No. 06/2022 dated 25.11.2022, passed by the Deputy Commissioner of GST and Central Excise, Madurai I Division. This order assessed the petitioner for excess Input Tax Credit (ITC) availment for the financial year 2018-2019 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 consider Circular No. 183/15/2022-GST dated 27.12.2022, issued by the Central Board of Indirect Taxes and Customs (CBIC). This circular provided clarification on dealing with differences in ITC availed in GSTR-3B versus GSTR-2A for FY 2017-2018 and 2018-2019, and stated it would apply to pending adjudication or appeal proceedings.

Key Issues

1. Whether the clarification issued by CBIC in Circular No. 183/15/2022-GST dated 27.12.2022, which applies to pending adjudication or appeal proceedings for FY 2017-2018 and 2018-2019, is applicable to the petitioner's case, despite the impugned order being passed prior to the circular? The petitioner argued that the circular's provisions should be applied as the writ petition was filed within the time limit to prefer an appeal, making the proceedings effectively pending. The respondent contended that the circular explicitly states it does not apply to completed proceedings, and the petitioner's case falls under this exclusion as the order-in-original had already been passed.