Power And Instrumentation (Guj.) LTD. vs. Commissioner
Held
The Court held that the respondents cannot insist on the petitioner paying the disputed amount of Rs. 5,51,49,553/- until final adjudication under Section 73 of the CGST Act, 2017, is completed. The Court acknowledged that the inquiry was ongoing and final adjudication had not been done. It was also noted that the petitioner had deposited Rs. 40,00,000/- on December 16, 2022, and an additional Rs. 10,00,000/- on April 3, 2023, via GST DRC-03. The Court directed that these total deposited amounts of Rs. 50,00,000/- shall remain subject to the final adjudication. The Court did not decide on the merits of the tax dispute itself, focusing on the procedural requirement of adjudication.
Facts
The petitioner, Power And Instrumentation (Guj.) Ltd., a Gujarat-registered company, was awarded electrification works by AVVNL in Dungarpur in 2014. The petitioner received a summons on November 10, 2022, regarding alleged short payment of GST on supplies to AVVNL for the period May 2018 to September 2021, with a demand of Rs. 5,51,49,553/-. The petitioner responded, stating the issue involved legal interpretation and that a favorable decision existed in the pre-GST regime. Despite objections, the petitioner claims to have been compelled to deposit Rs. 40,00,000/- via GST DRC-03 on December 16, 2022. The respondents initiated an inquiry, and the petitioner filed a writ petition seeking directions to invoke Section 73 for adjudication, refund of the deposited amount with interest, and a declaration that the demand is illegal.
Key Issues
1. Whether the respondents can demand payment of Rs. 5,51,49,553/- as short-paid GST without adjudicating the matter under Section 73 of the CGST Act, 2017? (Question of law). The petitioner argued that adjudication under Section 73 is mandatory before demanding payment, and they cannot be forced to pay an amount they dispute based on legal interpretation. They contended that the respondents acted illegally by demanding payment without following the prescribed adjudication process. The petitioner also sought the refund of Rs. 40,00,000/- deposited under duress. The respondents argued that the writ petition was premature and that the notices were issued in accordance with law. However, they admitted that the adjudication under Section 73 was yet to be finalized.
Sections Cited
Section 73, Section 73(5)
AI-generated summary — verify with the full judgment below
[2023:RJ-JD:24224-DB] HIGH COURT OF JUDICATURE FOR RAJASTHAN AT JODHPUR D.B. Civil Writ Petition No. 5274/2023 Power And Instrumentation (Guj.) Ltd., Having Its Registered Office At B-1104, Sankalp Iconic Tower, Opp. Vikram Nagar, Iskon Temple Cross Road, S.g. Highway, Ahmadabad - 380054 (Gujarat), Having Its Site Office At Brahmsthali Colony, Near Nikunj Plaza, Dungarpur, 314001. ----Petitioner Versus
Commissioner, Cgst Commissionerate, 142-B Hiran Magari Sector 11 Udaipur, Rajasthan
Assistant
Commissioner
(Anti
Evasion),
Cgst Commissionerate, 142-B Hiran Magri Sector 11 Udaipur, Rajasthan.
Superintendent (Anti Evasion), Cgst Commissionerate, 142-B Hiran Magri Sector 11 Udaipur, Rajasthan ----Respondents For Petitioner(s) : Mr Sharad Kothari For Respondent(s) : Mr Rajvendra Saraswat HON'BLE MR. JUSTICE VIJAY BISHNOI HON'BLE MR. JUSTICE YOGENDRA KUMAR PUROHIT Judgment / Order 25/07/2023
This writ petition is filed by petitioner-company with a prayer to grant following reliefs :- “It is therefore humbly prayed that the writ petition may kindly be allowed and by an appropriate order or direction:- a) The respondents may be directed to invoke section 73 fo
The judgment continues below.
Read the full judgment
A free account opens 10 full GST judgments a month (one account works on both bharattax.net and this site). Re-reading one you have already opened does not count again.
The summary, the parties, the sections and the citations above are open to everyone and always will be. Only the text of the order and the PDF are metered.
Reproduced from the public record of the Rajasthan High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.