M/S Jognia Construction vs. Assistant Commissioner, Central Goods And Service Tax

Held

The Court noted that the petitioner's counsel stated that the writ petition has become infructuous in view of an amendment through the Finance Act 2024. Consequently, the Court disposed of the writ petition as such. No specific findings were made on the merits of the issues raised by the petitioner regarding the disallowance of ITC, the penalty, the right to appeal without pre-deposit, or the time limit for claiming ITC. The reasoning for the disposal is solely based on the statement made by the petitioner's counsel that the petition has become infructuous due to legislative changes. The ratio decidendi is that a matter rendered infructuous by subsequent legislative amendments is to be disposed of accordingly. No specific operative directions were issued beyond disposing of the petition.

Facts

The petitioner, M/s Jognia Construction, filed a writ petition challenging an order dated May 28, 2020, passed by the Assistant Commissioner, Central Goods and Service Tax. This order disallowed input-tax credit (ITC) amounting to INR 62,74,097/- under Section 16(4) of the CGST/RGST Act and levied a penalty of INR 627,410/- under Section 122(2) of the CGST/RGST Act. The petitioner sought various reliefs, including quashing the order, declaring the denial of ITC due to technical glitches an abuse of process, asserting ITC as a vested right, and alternatively, allowing an appeal without mandatory pre-deposit or clarifying the time limit for claiming ITC. The petitioner's counsel stated that the writ petition has become infructuous due to an amendment through the Finance Act 2024.

Key Issues

1. Whether the order disallowing input-tax credit (ITC) amounting to INR 62,74,097/- and levying a penalty of INR 627,410/- under Sections 16(4) and 122(2) of the CGST/RGST Act, respectively, is liable to be quashed? The petitioner argued that denial of ITC due to technical glitches constitutes an abuse of process and violates their fundamental rights, asserting ITC as a vested right. The petitioner also sought an alternative relief to file an appeal under Section 107 of the CGST/RGST Act without the mandatory pre-deposit of 10% of the demand, as stipulated in Section 107(6). Furthermore, the petitioner sought clarification on the time limit for claiming ITC for the Financial Year 2018-2019, contending it should be the furnishing of the return in Form GSTR-3 for September following the financial year or the furnishing of the Annual Return (GSTR-9), whichever is earlier. The respondents' arguments are not recorded in the judgment.