W.P.(MD) No.17876 of 2024
BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
DATED: 31.07.2024
CORAM:
THE HONOURABLE MR.JUSTICE C.SARAVANAN
W.P.(MD) No.17876 of 2024
and
W.M.P.(MD) Nos.15336 and 15337 of 2024
M/S.Srinivasa Marbles ... Petitioner
/vs./
1.The Assistant Commissioner (ST) (FAC),
Madurai Rural (East) Assessment Circle,
Commercial Tax Buildings,
Madurai 625 020.
2.The Superintendent of GST & Central Excise,
Madurai North Range,
C.R.Buildings,
Madurai. ... Respondents
PRAYER: Writ Petition filed under Article 226 of the Constitution of India for
issuance of Writ of Certiorari, calling for records in assessment orders issued by
the 1st respondent in GST-DRC-07 GSTIN 33AASFS8669P1ZX dated 28.02.2023
and quash the same as illegal arbitrary without jurisdiction and in violation of the
Principles of natural justice.
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W.P.(MD) No.17876 of 2024
For Petitioner : Mr.S.Karunakar
For R1 : Mr.R.Suresh Kumar
Additional Government Pleader
ORDER
The petitioner is aggrieved by the impugned order dated 28.02.2023 passed
by the first respondent. By the impugned order, the first respondent has ordered as
follows:
“The claim of input tax credit of state tax of Rs.32,85,602/- and
Rs.32,59,565/- central tax of rs.32,61,366/- in the new Tran -1 filed by
the taxpayer is denied wholly.”
2.The dispute has arisen on account of the alleged transitioning of
ineligible input tax credit by the petitioner after the introduction of the respective
GST enactment. The impugned order records as follows:-
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W.P.(MD) No.17876 of 2024
3.The case of the petitioner is that in respect of the very same dispute, the
first respondent has already passed an order on 22.12.2023, wherein the following
orders have been passed insofar as the denial of input tax credit, which was
transitioned by the petitioner.
For the reasons stated above, the reply filed by the taxpayer is not
accepted. Hence they are hereby ordered to pay CGST Rs.1642801/- and SGST
Rs. 1642801/- along with the interest and penalty under Section 50,74 of GST acts
2017 as detailed below:
ABSTRACT
DESCRIPTION CGST (Rs.) SGST (Rs.)
ITC TO BE PAID 1642801 1642801
INTEREST 2332933 2332933
PENALTY 1642801 1642801
TOTAL 5618535 5618535
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W.P.(MD) No.17876 of 2024
4.It is submitted that the impugned order is at serial No.4 to the aforesaid
order dated 22.12.2023. It is submitted that as against the order dated 22.12.2023,
the petitioner is in appeal before the Appellate Authority under Section 107 of the
GST Act. The said appeal was filed on 20.03.2024 along with pre-deposit of Rs.
3,28,562/-.
5.It is submitted that the appeal is pending final disposal by the Appellate
Authority. However, on 10.07.2024, the respondents have recovered a sum of Rs.
1,97,331/- purportedly in pursuance of the impugned order dated 28.02.2023,
content of which has been extracted above.
6.The learned Additional Government Pleader for the first respondent
would submit that the impugned order is independently an appellable order in
terms of Section 107 of the GST Act, 2017. It is further submitted that the
impugned order is in response to the fresh application in TRAN 1 filed by the
petitioner on 01.12.2022, pursuant to the directions of the Hon'ble Supreme Court
in SLP(C) No.32709-32710 of 2018.
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W.P.(MD) No.17876 of 2024
7.It is submitted that the Superintendent of GST and Central Excise has
given a reply in Annexure-II dated 23.02.2023 and has stated that the petitioner
has attempted to transition the inadmissible amount of ITC under the machinery
prescribed for transitioning the input tax credit.
8.It appears that the petitioner has made a higher claim for Rs.32,85,602/-
in the new TRAN-1 application filed on 01.12.2022. In any event, before passing
the order, the petitioner should have been issued with proper notice. If the case of
the Department is that there is an error in the order passed on 22.12.2023,
whereby the denial of transition credit was restricted to only Rs.16,42,801/- each
and not the amount specified in the impugned order, the Department should have
initiated proceedings for rectification of the order dated 22.12.2023.
9.In any event, the impugned order dated 28.02.2023 has been passed
without following the principles of natural justice, as no notice was issued to the
petitioner.
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W.P.(MD) No.17876 of 2024
10.Considering the overall facts and circumstances of the case, I am
inclined to direct the respondents to keep all the recovery proceedings pursuant to
the impugned order dated 28.02.2023 in abeyance, as the said order has been
effected in the order dated 22.12.2023.
11.In case, there is any rectification of mistake warranted, it is for the
Department to initiate appropriate proceedings to rectify the aforesaid order dated
22.12.2023 after due notice to the petitioner. In case, the respondents want to
proceed against the petitioner pursuant to the impugned order, they shall issue
proper notice to the petitioner and adjudicate the same in accordance with law.
12.With the above directions, the Writ Petition stands disposed of. No
costs. Consequently, connected Miscellaneous Petitions are closed.
Index : Yes / No 31.07.2024
Internet : Yes / No
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W.P.(MD) No.17876 of 2024
To
The Assistant Commissioner (ST) (FAC),
Madurai Rural (East) Assessment Circle,
Commercial Tax Buildings,
Madurai 625 020.
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W.P.(MD) No.17876 of 2024
C.SARAVANAN, J.
mm
W.P.(MD) No.17876 of 2024
31.07.2024
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