M/S Tamanna Stone Works (A Proprietorship Concern) Thro Its Proprietor Namely Mohammad Karimuddin vs. State Of Jharkhand Through The Secretary, Department Of State Tax

Held

The Court held that no prejudice was being caused to the petitioner in responding to the second show-cause notice, as an explanation had already been furnished for the first notice. The Court found that the second notice pointed out further discrepancies, necessitating further explanation from the petitioner. Therefore, the Court was of the view that the petitioner needed to explain the alleged discrepancies furnished in the second show-cause notice dated July 4, 2024. The Court disposed of the writ petition by giving liberty to the petitioner to explain the reasons sought in the notice dated July 4, 2024, within two weeks. The authority was directed to consider the explanation in accordance with law and take follow-up action based on the conclusion, in line with the mandate of Section 61 of the JGST Act. The Court did not decide on the jurisdictional challenge to the second notice but directed the petitioner to respond to it.

Facts

The petitioner, M/s. Tamanna Stone Works, received a notice in Form GST ASMT 10 (Reference No. 47) dated April 24, 2024, from the respondent authorities under Section 61 of the Jharkhand Goods and Services Tax Act, 2017 (JGST Act), concerning scrutiny of returns. The petitioner responded to this notice. Subsequently, a second notice in Form GST ASMT 10 (Reference No. 422) dated July 4, 2024, was issued, also under Section 61 of the JGST Act read with Rule 99(1) of the JGST Rules. The petitioner challenged both notices, arguing that the second notice was issued without jurisdiction and in excess of the authority's power, especially since the first notice had already been responded to. The second notice pointed out further discrepancies in inward supply values and outward taxable supplies.

Key Issues

1. Whether the issuance of the second notice dated July 4, 2024, in Form GST ASMT 10, under Section 61 of the JGST Act, is without jurisdiction and in excess of the power conferred upon the respondent authority, given that a response to the first notice dated April 24, 2024, had already been submitted? Petitioner's contention: The petitioner argued that the issuance of a second notice was unwarranted and without jurisdiction, as they had already responded to the initial notice. They relied on Section 61 of the JGST Act to support their claim that the authority's power regarding scrutiny of returns was being exceeded. Revenue's contention: The respondent State submitted that the second notice was justified because it contained a wider scope of scrutiny, with every calculation upon scrutiny having been done by the authority. They contended that the petitioner should file a reply to the second notice for consideration and follow-up action in accordance with the statutory provisions of Section 61 of the JGST Act.