M/S Ridhi Sidhi Polymer And Anr vs. Union Of INDIA And Ors

Held

The Court did not delve into the question of jurisdiction at that stage. Instead, it proposed to the learned counsel for the petitioners whether it would be appropriate to await the decision of the refund application by respondent No.7, who is the competent authority. The petitioner's counsel was not in a position to deny the fairness of this proposal. Consequently, the writ petition was disposed of with a direction that respondent No.6 shall hold his hand regarding the petitioners until the prayer for refund is decided by respondent No.7. The Court did not decide the issue of jurisdiction of respondent No.6 or the delay in deciding the refund application, but rather provided a procedural interim arrangement. The ratio decidendi is that in such circumstances, a party should await the decision of the competent authority on a pending application before facing coercive action from another authority, especially when the fairness of this approach is not disputed.

Facts

The petitioners, M/s Ridhi Sidhi Polymer and another, filed a writ petition challenging summons dated 15.11.2021 and 23.11.2021 issued under Section 70 of the Central Goods and Services Tax Act, 2017, by respondent No.6. Their primary grievance was that despite an earlier order of the High Court on 14.10.2021 in a related matter, their refund application remained undecided, while summons were being issued by an authority (respondent No.6) allegedly lacking jurisdiction, with jurisdiction resting with respondent No.7. The respondents, Union of India and others, and the State of Punjab, accepted notice. The Court considered the fairness of awaiting the decision on the refund application before further action.

Key Issues

1. Whether respondent No.6 has the jurisdiction to issue summons under Section 70 of the CGST Act, 2017, when the refund application is pending before respondent No.7, the competent authority. Petitioner's contention: The petitioner argued that respondent No.6 lacks jurisdiction to issue the impugned summons, as the competent authority for deciding the refund application is respondent No.7. They also highlighted that the respondents have not decided their refund application despite an earlier court order. The petitioner's counsel did not deny the fairness of awaiting the decision on the refund application. Revenue's contention: The respondents, Union of India and others, and the State of Punjab, accepted notice. No specific arguments were recorded for the revenue regarding the jurisdiction of respondent No.6 or the delay in deciding the refund application. However, the Court proposed awaiting the decision on the refund application, to which the petitioner's counsel did not object.