M/S Swal Limited Through Its Authorized Signatory Gouranga Das vs. The State Of Jharkhand

Held

The Court noted that the petitioner's counsel, on instructions, submitted that the suspension of registration ordered on May 7, 2024, had been revoked. Therefore, the relief sought in paragraph 1(A) of the writ petition was deemed redressed. Regarding the unblocking of Input Tax Credit (ITC) amounting to Rs. 1.13 Crore, which was blocked as a consequence of the registration suspension, the Court directed the petitioner to make a representation to the concerned authority. The authority was then mandated to pass an appropriate order in accordance with the law within two weeks from the date of receipt of such representation. The Court did not expressly leave any issue undecided, as the primary issue of registration suspension was resolved by its revocation, and the consequential issue of ITC was remitted for decision by the authority.

Facts

The petitioner, M/s SWAL LIMITED, filed a writ petition challenging an order of suspension of its GST registration dated May 7, 2024, issued by the State Tax Officer, Adityapur. The petitioner argued that the suspension was issued without proper inspection or verification, contradicting an inspection conducted by the Central GST Department. The petitioner also sought to unblock Input Tax Credit (ITC) amounting to Rs. 1.13 Crore, which was blocked as a consequence of the registration suspension. The respondents, the State of Jharkhand and its tax authorities, acknowledged that the suspension order had been revoked.

Key Issues

1. Whether the order of suspension of registration in Form GST-REG-17 dated May 7, 2024, was validly issued without carrying out any inspection or verification of the petitioner's unit, and if it is contrary to the inspection conducted by the Central GST Department, as contemplated under Section 22(1) of the CGST Act, 2017. 2. Whether the Input Tax Credit (ITC) available to the petitioner to the tune of Rs. 1.13 Crore, which was blocked in consequence of the suspension of registration, should be unblocked. Petitioner's Contentions: The petitioner contended that the suspension of registration was issued without proper inspection and verification, making it contrary to the findings of the Central GST Department's inspection. They argued that the blocking of ITC was without plausible or justifiable grounds. Revenue's Contentions: The respondent-State submitted that since the suspension of registration had already been revoked, the blocking of ITC, being a consequence of the suspension, would be dealt with by the authority after revocation. They further stated that if the petitioner brings this fact to the notice of the concerned authority, an appropriate order would be passed in accordance with law.