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Part-67-One Pager Snapshot to the Latest Cases

Refund of Amount collected during the search
-Extraordinary circumstances not made out for Article 226
-No retrospective Cancellation if notice does not provides so
-Cancellation of Registration by a Cryptic Notice and Equally Cryptic Order

S.No

Section

Case Subject

Case

Held

1

Section 67
and Section
54

Refund of
Amount
collected
during the
search

Modern Insecticides Ltd. v.
Commissioner, Central Goods
and Service Tax [2023] 153
taxmann.com 548 (Punjab &
Haryana)

Question for consideration, was whether amount paid by the petitioner on 16-1-2021, could be retained by the department without
issuing the show cause notice under section 74 (1) of the CGST Act that too after expiry of two years.
High Cout observed that amount was deposited from the date when search was conducted. However, no notice under section 74
(1) had been issued. Though department can initiate proceedings under section 74 (1) by issuing notice within the period of limitation,
they cannot retain the amount of Rs. 1.54 crore deposited by the petitioner, which as per department was voluntary. The amount
was deposited during search and as per judgment passed in Vallabh Textiles' case, this deposit cannot be taken to be voluntary.
Since no proceedings under section 74 (1) were initiated till date, as per Rule 142 (1A), the department cannot even issue Form
GST DRC-01A to ask the petitioner to make payment of tax, interest and penalty due. Therefore, a direction was given to return the
amount of Rs. 2.54 crores along with simple interest at the rate of 6% per annum.
Cases Referred-Vallabh Textiles v. Senior Intelligence Officer and others, 2022 SCC OnLine Del 4508, Bhumi Associate v. UOI,
SCA No. 3196 of 2021.

2

Article 226
of
Constitution

Extraordinary
circumstances
not made out
for Article 226

Muhammad Saleem
Shemsudeen v. Enforcement
Officer [2023] 153
taxmann.com 547 (Kerala)

The writ petition was dismissed stating that the Court did not any extra ordinary circumstances made out, to entertain the writ petition
by exercising the plenary powers of this Court under Article 226 of the Constitution of India. It was left up to the petitioner to invoke
his statutory remedies as provided under the GST Acts.

3

Section 29
and Section
30

No
retrospective
Cancellation if
notice does
not provides
so

Virender Kumar Jain v. Delhi
GST Officer, Ward 76 [2023]
153 taxmann.com 546 (Delhi)

The petitioner was not aggrieved by cancellation of his GST Registration; he was aggrieved because the registration had been
cancelled with retrospective effect from 1-7-2017
High Court noted that the show cause notice dated 16-2-2021 did not indicate that the concerned officer had proposed to
cancel the same with retrospective effect. SCN also did not indicate that any inquiries were made, which revealed that the
petitioner had never existed at his declared place of business. The order was an unreasoned order completely disregarding that the
petitioner had filed an application dated 20-11-2020 for cancellation of his GST Registration and disclosed that he had stopped
carrying on business. Thus, the question of petitioner being available at principal place of business did not arise. The High Court
allowed the petition and directed that cancellation of GST Registration shall be effective from 20-11-2020.

4

Section 29
and Section
30

Cancellation
of Registration
by a Cryptic
Notice and
Equally
Cryptic Order

Ottimo Visuals v.
Commissioner of GST [2023]
153 taxmann.com 545 (Delhi)

The petitioner was not aggrieved by cancellation of his GST Registration; he was aggrieved because the registration had been
cancelled with retrospective effect from 1-7-2017
High Court noted that the show cause notice dated 16-2-2021 did not indicate that the concerned officer had proposed to
cancel the same with retrospective effect. SCN also did not indicate that any inquiries were made, which revealed that the
petitioner had never existed at his declared place of business. The order was an unreasoned order completely disregarding that the
petitioner had filed an application dated 20-11-2020 for cancellation of his GST Registration and disclosed that he had stopped
carrying on business. Thus, the question of petitioner being available at principal place of business did not arise. The High Court
allowed the petition and directed that cancellation of GST Registration shall be effective from 20-11-2020.