Gopal Datt Bhatt vs. The Assistant Commissioner

Held

The Court noted the submission of the learned counsel for the State, who conceded that the department was open to reconsideration in case of miscalculation or arithmetical error. Consequently, the Court disposed of the petition by granting liberty to the petitioner to file an application under the second proviso to Section 161 of the GST Act. The Court directed that if such an application is filed, it shall be considered without reference to the limitation period imposed by the first proviso and shall be disposed of on merits by the Assessing Officer. Until the disposal of the application under Section 161, no coercive action shall be taken against the petitioner, provided the application is made within two weeks of receiving the certified copy of the order. The Court did not expressly leave any issue undecided, as the matter was resolved through a procedural direction.

Facts

The petitioner, Gopal Datt Bhatt, approached the High Court of Uttarakhand challenging two Show Cause Notices (SCNs) and two consequential orders issued by the Assistant Commissioner, State Goods & Services Tax, Haldwani. These notices and orders, pertaining to the financial year 2020-21, sought to impose demands of Rs. 179,156/- and Rs. 27,776/- respectively. The petitioner's grievance was that these demands arose due to a discrepancy caused by the non-capturing of GSTR-3B entries and tax paid under the reverse charge mechanism, despite these figures being correctly reflected in the GSTR-3B. This, the petitioner argued, resulted in a wrongful demand where the tax demand exceeded the petitioner's taxable turnover.

Key Issues

1. Whether the impugned Show Cause Notices and consequential orders, issued under Section 73 of the CGST Act, are vitiated by an erroneous demand arising from the non-reflection of GSTR-3B entries and reverse charge mechanism payments, thereby leading to a demand exceeding the taxable turnover (Question of law and fact)? Petitioner's Contention: The petitioner argued that the demands were erroneous due to a discrepancy in accounting for GSTR-3B entries and tax paid under the reverse charge mechanism. This led to a situation where the tax demand was disproportionately higher than the petitioner's actual turnover. The petitioner prayed for relief under Section 161 of the GST Act for rectification and under Section 75(4) for an opportunity of rehearing. Revenue's Contention: The learned counsel for the State fairly submitted that if there was a miscalculation or an arithmetical error due to the introduction of an additional numerical figure, the department was open to reconsideration, and the matter could be remitted back.