Part-163-One Pager Snapshot to Cases on Section 61,73, 75 and 129 of CGST Act, 2017

-Section 73-SCN only can be taken forward, by permitting the petitioner to urge all contentions in relation to the SCN and thus. statement of one of the transporters recorded during enquiry, needs to be provided to the petitioner

-Section 129- Delivery Note and Delivery Challan are different documents and penalty confirmed since goods during movement only had delivery note and not delivery challan as required under Rule 55 read with Rule 138 along with document substantiating goods were sent for approval and payment of tax & penalty also voluntarily deposited by petitioner at the time of release of goods

-Section 75-Impugned order quashed as authority neither replied to the request of petitioner for grant of 30-days time to file reply nor did it provide opportunity of being heard even though the same was requested by the petitioner

-Section 61-Impugned SCN stayed as Court prima facie found force in contention of petitioner that issuance of SCN U/Sec 73 was without compliance of the mandatory conditions precedent, prescribed under provisions of Section 61 r/w Rule 99, to derive jurisdiction to issue SCN U/sec 73

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Part-70-One Pager Snapshot to the Latest Cases

-Personal hearing to be afforded , even if petitioner may have signified ‘No’ in the column to avail personal hearing
-Service of Order on the counsel of the petitioner is valid and limitation to file appeal commences from that day
-Audit U/Sec 65 cannot be conducted for a dealer subsequent to cancellation of registration
-Appellate Authority even while considering appeal ex parte will have to consider the grounds raised in the memorandum of appeal
-In case of shortage of goods found in checking during movement, penalty to be levied on the shortage found and not on entire consignment

70.-Daily-Round-up-to-the-Latest-CasesDownload

S.No

Section

Case Subject

Case

Held

1

Section
75(4)

Personal hearing to
be afforded , even if
petitioner may have
signified 'No' in the
column to avail
personal hearing

B.L. Pahariya
Medical Store v.
State of U.P [2023]
153 taxmann.com
659 (Allahabad) 22-
08-23

High Court observed that once it has been laid down by way of a principle of law that a person/assessee is not required to request for
"opportunity of personal hearing" and it remained mandatory upon the Assessing Authority to afford such opportunity before passing an
adverse order, the fact that the petitioner may have signified 'No' in the column meant to mark the assessee's choice to avail
personal hearing, would bear no legal consequence. It was further observed that even otherwise in the context of an assessment
order creating heavy civil liability, observing such minimal opportunity of hearing is a must.
Cases Referred- Bharat Mint & Allied Chemicals v. Commissioner Commercial Tax [2022] 136 taxmann.com 275

2

Section 107

Service of Order on
the counsel of the
petitioner is valid
and limitation to file
appeal commences
from that day

Manoj Steel
Traders v. State of
U.P. [2023] 153
taxmann.com 658
(Allahabad) 23-08-
23

From the perusal of provisions of Section 169, it is evident that order communicated on an Advocate will be deemed service upon
petitioner. As per facts of the case, order was duly communicated to the Advocate of petitioner. Petitioner argued that on 26-6-2019, an
application was moved for getting the certified copy of the order through another counsel and on that very day, the appeal was preferred.
However, on the pointed query as to how and under what mode the petitioner came to know about the passing the order dated
28-3-2018 on 26-6-2019 and as to why the application was moved on 26-6-2019 by another counsel, when the order dated 28-3-
2018 was already communicated to the petitioner's Advocate, petitioner could not reply the same and submitted that the appeal
filed below is silent on this point. The fact that it was not disputed at any stage and the only ground taken was that Shri Anil Jain,
Advocate has not informed the petitioner about the order dated 28-3-2018, it was held that the impugned order cannot be interfered with

3

Section 65

Audit U/Sec 65
cannot be
conducted for a
dealer subsequent
to cancellation of
registration

Tvl. Raja Stores v.
Assistant
Commissioner (ST
[2023] 153
taxmann.com 657
(Madras) 11-08-23

The contention of the petitioner was under Section 65, respondents were empowered to conduct audit if the concern was a registered
unit. As on the date, the petitioner's registration was cancelled, and he was an unregistered concern. But the contention of the respondent
was that the audit was being conducted for a period from 2017-2018, 2021-2022. Therefore, the respondent claimed that for the said
period, the petitioner was a registered firm and for the said period, the respondent was empowered to conduct audit.
The High Court observed that Section 65 specifically states that the audit can be conducted for 'any registered person', then it
ought to be construed as existence concern and the unregistered person would be exempted from the purview of the said
section. When the Section provides for periodical audit, the respondent having failed to conduct audit for all these years, suddenly they
cannot wake up and conduct an audit. Therefore, impugned order was quashed with liberty to the respondent to initiate assessment
proceedings under Sections 73 and 74 of the Act.

4

Section 107

Appellate Authority
even while
considering appeal
ex parte will have to
consider the
grounds raised in
the memorandum
of appea

Ganesh Kumar v.
State of Bihar
[2023] 153
taxmann.com 654
(Patna) 11-07-23

Appeal was dismissed that despite opportunity being granted to appellant to produce documents in his support, he did not produce them.
High Court observed that Appellate Authority has a duty and an obligation under the statute to look into the merits of the matter and
also examine the grounds raised by the appellant and decide the issue on merits. The Appellate Authority even while considering the
appeal ex parte will have to consider the grounds raised in the memorandum of appeal, deciding the appeal on merits, failing which it
would be abdicating its powers especially looking at the provisions where the Appellate Authority has been empowered to conduct such
further enquiry as found necessary to decide the appeal, which decision also shall be on the points raised. Therefore, in view of the
above, since the appeal was decided ex-parte, therefore the appellate order was set aside.
Cases Referred- Purushottam Stores vs. The State of Bihar & Ors; CWJC No. 4349 of 2023 decided on 25.04.2023

5

Section 129

In case of shortage
of goods found in
checking during
movement, penalty
to be levied on the
shortage found and
not on entire
consignment

Usha Gupta v.
Assistant
Commissioner of
Revenue, Bureau
of Investigation
[2023] 153
taxmann.com 653
(Calcutta) 30-03-23

In the export invoice, buyer's license number was shown as buyer's order number. The High Court held that this cannot be treated as
a discrepancy because in the purchase order of the buyer the sales order number has been correctly shown as SG/2022-23/004.
Therefore, authorities could not have imposed 200% penalty on the entire consignment.
For the issue regarding shortage of quantity of goods observed in checking of goods during movement and levy of penalty on entire
consignment appeal and writ petition was disposed by setting aside the order passed by the appellate authority for levying
penalty on the entire consignment and the matter was remanded back to the appellate authority to recalculate to take note of
the order and recalculate the penalty in respect of shortage in quantity and over than quantity penalty shall be levied at 200%

Snapshot-36-Snapshot of Latest GST Cases

-Reasonable opportunity of being heard be given and decision to extend time be exercised with sound reasons
-Cononation beyond Limitation Period not allowed
-No Levy of Penalty due to Expiry of way Bill
-Grant of Anticipatory Bail

36.-Daily-Round-up-to-the-Latest-CasesDownload

S.No

Section

Case Subject

Case

Held

1

Section
73 and
section
75

Reasonable
opportunity of
being heard be
given and
decision to
extend time be
exercised with
sound reasons

Exide
Industries Ltd.
v. Deputy
Commissioner
(CT) [2023]
151
taxmann.com
110 (Madras)

The High Court observed that reasonable opportunity ought to be given to a person to show cause and depending upon the facts of each case,
even further extension of time can be granted by the Assessing / Adjudicating Officer. In any event, the decision to refuse or extend time ought to
be exercised with sound reasons and not in an arbitrary or capricious manner.
In view of the above, the court found that impugned orders did not discuss the reasons for extension of time at all, leave alone giving its finding
either granting or refusing the adjournment. In such circumstances, it was clear that there was a clear violation of the Circular No. 12/2022 Dt 26th
September 2022 (TNGST) and therefore it was held that petitioner be afforded a fair opportunity to submit its explanation in respect of three
pending queries within a reasonable time and thereupon, the respondent may pass fresh orders considering the entire explanation submitted by
the petitioner, including the earlier explanations submitted by it., The impugned orders were set aside.

2

Section
107

Condonation
beyond
limitation period
not allowed

[2023] 151
taxmann.com
109 (Patna)
Badri Prasad
Yadav v. State
of Bihar

The remedy of writ is an absolutely discretionary remedy. The High Court, hence, can always refuse the exercise of discretion if there is an
adequate and effective remedy elsewhere. The High Court can exercise the power only if it comes to the conclusion that there has been a breach
of principles of natural justice or due procedure required for the decision has not been adopted. The High Court would also interfere if it comes to
a conclusion that there is infringement of fundamental rights or where there is failure of principles of natural justice or where the orders and
proceeding are wholly without jurisdiction or when the vires of an Act is challenged.
It was further observed that when there is a specific period for delay condonation provided, there cannot be any extension of the said period by
the Appellate Authority or by this Court under Article 226 of the Constitution. The petitioner by his own failure had not availed the appellate remedy
and in that circumstance, there can be no invocation of the extraordinary jurisdiction under Article 226 of the Constitution of India. The High Court
did not find that there was a jurisdictional error, violation of principles of natural justice or abuse of process of Court averred or argued by the
petitioner in the above writ petition. The petitioner sought to challenge the demand on the ground that the ITC claimed by the petitioner was proper;
which was merely determination of the tax payable on the basis of the various claims validly arising from the statute and computation; which cannot
be agitated in a petition under Article 226 of the Constitution of India. The gross delay stands against the petitioner and delay was not condoned.
Cases Referred- State of H.P & Ors. v. Gujarat Ambuja Cement Limited & Anr.; [2005] 6 SCC 499

3

Section
129

No Levy of
Penalty due to
Expiry of way
Bill provided
intent to evade
absent

Ramji Jaiswal
v. State Tax
Officer,
Bureau of
Investigation
[2023] 151
taxmann.com
165 (Calcutta)

n the instant petition, the petitioner challenged the order of adjudicating authority imposing the penalty for transporting the vehicle in question
after expiry of the e-way bill which expired on 2nd August, 21 at 11.59 p.m. and vehicle in question was intercepted at 6.45 p.m. on 3rd August,
2021. There was a time gap between the expiry and interception of the vehicle in question of about 18 hrs., which was less than a day and
petitioners submitted there was no intention of evasion on part of petitioners and there was a genuine problem of break down of vehicle in question.
The High Court decided the matter in favour of the petitioner in view of the facts which appeared from record and considering the orders of the
Calcutta High Court by setting aside the impugned order and as a consequence, petitioners were held to be entitled for refund of the penalty.
Cases Referred- Ashok Kumar Sureka v. Assistant Commissioner, State Tax, Durgapur Range

4

Section
69 and
Section
132

Grant of
Anticipatory Bail

Kishan Murari
Gupta
V State of U.P
[2023] 151
taxmann.com
164
(Allahabad)

In the instant case, it was submitted by the petitioner that since seller firm as per allegation in the FIR had been found bogus, therefore, their firm
being the purchaser firm, proceedings under section 74 of U.P. G.S.T. Act were going on and they have participated in those proceedings and
against the order of the assessing authority, appeal had been filed by depositing 10% of the disputed tax amount. It was submitted that the dispute
was purely civil in nature. The petitioner had no criminal antecedent.
The High Court observed that considering the above aspects of the matter, perusal of the record, the fact that proceedings under section 74 of the
U.P. G.S.T. Act were going on, as also the judgment in Sushila Aggarwal and others versus State (NCT of Delhi) and another (2020)5 SCC 1 and
without entering into the merit of the case, it would be appropriate to grant protection to the applicants under Section 438 Cr.P.C

Snapshot-26-Snapshot of Latest GST Cases

-A vague Show cause Notice and Section 75
– Condonation beyond Limitation Period
-Liability to pay amount due to other party to DGGSTI
-Ex-Parte order passed in violation of principle of natural justice

26.-Daily-Round-up-to-the-Latest-CasesDownload

S.No

Section

Case Subject

Case

Held

1

Section
74 and
Section
75

A vague notice is
violation of
provision in
Section 75 since
the Statute itself
prescribes for
affording
reasonable
opportunity and
any deficiency in
that regard vitiates
the result

Durge Metals v.
Appellate
Authority and
Joint
Commissioner
State Tax [2023]
150 taxmann.com
333 (Madhya
Pradesh)

The petitioner contended that SCN was vague to the extent of not communicating the relevant information and material thereby disabling the
petitioner to respond to the same, and therefore, all consequential actions of passing of order and dismissal of appeal are vitiated in law.
The High Court observed that even though the petitioner had not specifically raised the said ground before the appellate authority but the
fact remained that mandatory provisions of Section 74 of GST Act make it incumbent upon the Revenue to ensure the show cause notice to
be speaking enough to enable the assessee to respond to the same. However, SCN revealed that it neither contained the material and
information nor the statement containing details of ITC transaction under question. It was further observed that Section 75 of GST Act is a
complete Code which prescribes for various stages for determination of wrongful utilization of ITC while following the concept of reasonable
opportunity of being heard to the assessee. Since the Statute itself prescribes for affording reasonable opportunity, it is incumbent upon the
Revenue to afford the same and any deficiency in that regard vitiates the result. The High Court held that it had no manner of doubt that the
very initiation of the proceedings by way of show cause notice was vitiated for the same being vague.
Case Referred- Sidhi Vinayak Enterprises v. The State of Jharkhand & ors) including WP(T) No.745/2021 14thth, September 2022

2

Section
107

No power to
entertain the
application for
condonation of
delay beyond
permissible p

Farhat
Construction
v. State of
Chhattisgarh
[2023] 150
taxmann.com 334
(Chhattisgarh)

The High Court held that there is no power to entertain the application for condonation of delay beyond permissible period provided under
the Act of 2017. The High Court further held that petitioner has wrongly contended that the period of delay has wrongly been assessed by
Appellate Authority in the light of the order of Hon’ble Supreme Court in case of Re-cognizance for extension of limitation (Supra), the matter
be remitted back to the First Appellate Authority as even after excluding period between 15.03.2020 to 28.02.2022, filing of an appeal would
not come within extended period of limitation as ordered by Hon’ble Supreme Court and therefore, said exercise would serve no purpose
Cases Referred-Nandan Steels And Power Limited Vs. State of Chhattisgarh & Ors. in W.A. No. 104 of 2021, decided on 10.08.2022

3

Section
174

GAIL cannot be
asked to pay
amount to
DGGSTI since
GAIL did not owe
any amount to
other party

Gail (India) Ltd.
v. Directorate
General of GST
Intelligence [2023]
150 taxmann.com
335 (Delhi)

Petition was filed against the order dated 08.03.2018 issued by DGGSTI under Section 87(b) of Chapter-V of the Finance Act, 1994 read
with Section 174(2)(e) of the 'CGST Act' calling upon GAIL to pay a sum of Rs. 13,13,07,485/- which, DGGSTI believes, is owed by GAIL to
the other party.
The High Court held that there was no material to show that any such amount was due and payable by GAIL. GAIL and DGGSTI are adidem that the only amount that GAIL was required to pay was approximately Rs. 6.54 crores after the other party has issued the invoice of
Rs. 1.01 crores. In view of the above, the impugned order was set aside and GAIL was however restrained from making any payments to
other party for a period of four weeks

4

Section
73 ad
Section
74

Ex-Parte order
passed in violation
of principle of
natural justice is
illegal and is a fit
case for
interference by the
High Court

Lucky Traders v.
State of Bihar
[2023] 150
taxmann.com 338
(Patna

In the instant case, ITC claim of the petitioner was rejected and tax, including interest and penalty, had been imposed, without providing any
further notice to the petitioner..
The High Court observed that notwithstanding the statutory remedy, it was not precluded from interfering where, ex facie, the order was bad
in law on account of the two reasons- (a) violation of principles of natural justice, i.e. Fair opportunity of hearing. No sufficient time was
afforded to the petitioner to represent his case; (b) order passed ex parte in nature, does not assign any sufficient reasons even decipherable
from the record, as to how the officer could determine the amount due and payable by the assessee. The order, ex parte in nature, passed
in violation of the principles of natural justice, entails civil consequences. The matter was thus remanded back

Snapshot-22-Snapshot of Latest GST Cases

-Revocation of Cancellation of Registration
-Vague notice and No Opportunity of being heard
-GST Burden in case of Pre and Post GST Contracts
-Recovery of demand on Non-constitution of Tribunal
-Rejection of Anticipatory Bail

22.-Daily-Round-up-to-the-Latest-CasesDownload

S.No

Section

Case Subject

Case

Held

1

Section
29 and
Section
30

Petitioner directed to
file application for
revocation of
Cancellation of
Registration as per
notification no.
3/2023-CTdt 31-3-23

Anandkumar Ramdeo
Singh v.
Commissioner
(Appeals-I) GST and
Central Tax [2023] 151
taxmann.com 13
(Karnataka)

The High Court observed that the notification dated 31.03.2023 has been issued providing for revocation of cancellation of the
registration. Since the cancellation was under the provisions of Section 29(2) of the CGST Act and such cancellation was before
31.12.2022, and an application for revocation was not filed, the High Court stated that application be submitted that in terms of this
notification.

2

Section
74 and
Section
75

A vague notice is
violation of provision
in Section 75 since
the Statute itself
prescribes for
affording reasonable
opportunity and any
deficiency in that
regard vitiates the
result.

[2023] 151
taxmann.com 12
(Madhya Pradesh)
Balaji Electricals
v. Appellate Authority
& Joint Commissioner
State Tax.

The High Court observed that even though the petitioner had not specifically raised the said ground before the appellate authority
but the fact remained that mandatory provisions of Section 74 of GST Act make it incumbent upon the Revenue to ensure the show
cause notice to be speaking enough to enable the assessee to respond to the same. However, SCN revealed that it neither contained
the material and information nor the statement containing details of ITC transaction under question. It was further observed that
Section 75 of GST Act is a complete Code which prescribes for various stages for determination of wrongful utilization of ITC while
following the concept of reasonable opportunity of being heard to the assessee. Since the Statute itself prescribes for affording
reasonable opportunity, it is incumbent upon the Revenue to afford the same and any deficiency in that regard vitiates the result.
The High Court held that it had no manner of doubt that the very initiation of the proceedings by way of show cause notice was
vitiated for the same being vague.
Case Referred- Sidhi Vinayak Enterprises v. The State of Jharkhand & ors) including WP(T) No.745/2021 14thth, September
2022,

3

Section 9

to bear GST Burden
in case of Pre and
Post GST Contracts
wherein impact of
GST was not
considered while
preparing BOQ

[2023] 151
taxmann.com 12
(Madhya Pradesh)
Balaji Electricals
v. Appellate Authority
& Joint Commissioner
State Tax.

The matter in the instant petition was to give by way of direction upon the respondent authority concerned to bear the additional tax
liability for execution of subsisting Government contracts either awarded in the pre-GST regime or in the post GST regime without
updating the Schedule of Rates (SOR) incorporating the applicable GST while preparing Bill of Quantities (BOQ) for inviting the bids
The High Court disposed of the writ petition by giving liberty to the petitioner to file appropriate representations in the aforesaid
regard before the Additional Chief Secretary, Finance Department, Government of West Bengal within four weeks from date. On
receipt of such representations the Additional Chief Secretary, Finance Department was directed to take a final decision within four
months from the date of receipt of such representation after consulting with all other relevant departments concerned.

4

Section
112

Status of Recovery of
demand on account
of non-constitution of
Tribunal.

Flipkart India (P.) Ltd.
v. Additional
Commissioner of
State Tax (Appeal)
[2023] 151
taxmann.com 10
(Patna)

The High Court held that subject to verification of the fact of deposit of a sum equal to 20 percent of the remaining amount of tax in
dispute, or deposit of the same, if not already deposited, in addition to the amount deposited earlier under Sub-Section (6) of Section
107 of the B.G.S.T. Act, the petitioner must be extended the statutory benefit of stay under Sub-Section (9) of Section 112 of the
B.G.S.T. Act, for he cannot be deprived of the benefit, due to non- constitution of the Tribunal by the respondents themselves. The
recovery of balance amount, and any steps that may have been taken in this regard will thus be deemed to be stayed.
Case Referred- AJ Food Products Pvt. Ltd. v. The State of Bihar & Others in C.W.J.C. No. 15465 of 2022

5

Section
69 and
Section
132

Rejection of
Anticipatory Bail

[2023] 151
taxmann.com 9 (SC)
Sheetal Mittal v. State
of Rajasthan

The Supreme Court held that looking to the role attributed to the petitioner(s) and the observations made by the High Court that the
GST number, name of the firm were fabricated and other details were found to be non-existent, there was no case for anticipatory
bail. The Special Leave Petitions were thus dismissed