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2023 (5) TMI 712 - HC - GST


Issues:
The issue in this case is whether the department is required to issue a notice under subsection 3 of Section 61 of the Central Goods and Service Tax Act, 2017 after the assessee has submitted returns before taking action under Section 74 of the Act.

Details of Judgment:
The petitioner, an assessee under the GST regime, had submitted returns for the assessment year 2019-20. The department initiated proceedings under Section 74 against the petitioner regarding the classification and tax payable on certain goods. The department found a shortfall in the tax previously paid and demanded the deposit of the shortfall, along with interest and penalty.

The petitioner argued that since returns were submitted, the department should have pointed out any deficiencies in the returns before proceeding under Section 74. Section 61 of the Act allows the proper officer to scrutinize returns, inform the assessee of any discrepancies, and take appropriate action if the discrepancies are not rectified.

The court noted that in this case, no discrepancies were noticed in the returns, and the department proceeded with Section 74 without pointing out any deficiencies. The court held that the scrutiny of returns under Section 61 and proceedings under Section 74 are separate, and the department can initiate action under Section 74 without issuing a notice under Section 61(3).

The court also addressed a judgment cited by the petitioner, stating that it did not restrict the exercise of jurisdiction under Section 74 based on the issuance of a notice under Section 61(3). The court rejected the argument that classification or tax payment issues cannot be addressed under Section 74 without a notice under Section 61.

The court allowed the petitioner to file an appeal within two weeks, without objections to the limitation, if the appeal is filed. The petition was dismissed, subject to the above observations.

 

 

 

 

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