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GST - Case Laws
Showing 1 to 20 of 16301 Records
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2025 (7) TMI 331
Demand of tax and penalty raised contrary to the SCN issued to the petitioner - beyond the scope of SCN - violation of Section 75(7) of GST Act - HELD THAT:- A perusal of Section 75(7) would reveal that Section 75 deals with general provisions relating to determination of tax and sub-section (7) specifically stipulates that the amount of tax, interest and penalty demanded in the order shall not be in excess of the amount specified in the notice and no demand shall be confirmed on the grounds other than the grounds specified in the notice.
Admittedly, in the present case, the show-cause notice merely indicates the amount of Rs. 4,80,527.36 as representing the tax, interest and penalty and the demand qua the three components has been raised at Rs. 24,40,363.10, which is ex facie contrary to the provisions of Section 75(7) of the Act.
Thus, on account of violation of provisions of Section 75(7) of the Act, the order impugned cannot be sustained - the order dated April 27, 2024 (Annexure-1) is quashed and set aside and the matter is remanded back to the respondent no. 2 to provide an opportunity to the petitioner to file response to the show-cause notice and after providing opportunity of hearing, pass a fresh order in accordance with law - petition allowed by way of remand.
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2025 (7) TMI 330
Dismissal of appeal preferred by the petitioner as being beyond time limitation - HELD THAT:- On perusal of the order passed under Section 73 of the GST Act, which is on record, although there is a reference to the reply submitted by the petitioner in response to the show cause notice, the reason for not accepting the said reply mainly on the ground that evidence was not available, is prima facie not acceptable as it was open to the assessing authority to have directed the petitioner to file evidence in support of the defence as taken by the petitioner. The order under Section 73 of the GST Act, prima facie, holds the petitioner guilty without there being any specific application of mind particularly to the defence taken by the petitioner.
Finding the said order is short of requirement of principles of natural justice, the order dated 31.08.2024 is quashed. The appellate order dated 18.03.2025 is also set aside - The matter is remanded to the assessing authority to pass fresh order in accordance with law after affording opportunity of hearing - Petition allowed by way of remand.
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2025 (7) TMI 329
Cancellation of registration fo petitioner on the ground of non-furnishing of GST returns for a continuous period of six months - necessary SCN u/s 142(1)(A) of the CGST Act had not been issued prior to the commencement of the proceedings culminating in the demand order - demand order as well as the show cause notices were issued after the expiry of period of limitation under Section 73(10) and 70(2) of the GST Act - adequate opportunity was not given to the petitioner - violation of principles of natural justice - HELD THAT:- In the present case, it was not disputed by the Revenue that no such notice under Section 142(1)(A) had come to be served on the petitioner prior to the assessment proceedings being taken up.
The Writ Petition is disposed of setting aside the demand order, dated 28.12.2023, and remanding the matter back to the assessing authority for completing the assessment after following the necessary procedure set out under the provisions of the GST as well as the rules made thereunder. Needless to say, the period between the date of the passing of the impugned order till the receipt of this order shall be excluded for the purpose of limitation.
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2025 (7) TMI 328
Attachment and payment alleged to have been short-paid by the petitioner - request for grant of monthly installments, has not been considered and that garnishee proceedings, dated 15.04.2025, which had already been issued was being pressed - HELD THAT:- In view of the admission of the petitioner that it is liable to pay the aforesaid sum of Rs.35,59,067/-, it would not be appropriate for this Court to intervene against the garnishee proceedings, dated 15.04.2025. However, the non-disposal of the representation of the petitioner for equal monthly instalments, dated 26.05.2025, would certainly affect the interest of the petitioner apart from the fact that it is also the duty of the 2nd respondent to consider such applications at the earliest.
This Writ Petition is disposed of with a direction to the 2nd respondent to consider and pass orders on the representation of the petitioner, dated 26.05.2025, for grant of 24 equal monthly installments, for clearing the aforesaid dues of the petitioner, within a period of three weeks from the date of receipt of the order.
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2025 (7) TMI 327
Recovery of husband-the detenue, who had been in the illegal custody of respondents No. 2 and 3 since 04.06.2025 - illegal custody - non-production of detenue before the competent Court within the stipulated 24 hours - HELD THAT:- The accuracy and integrity of this document is attested - Further, as per the report of the Warrant Officer, the detenue remained in custody of respondents No.2 and 3 since 12:02 PM on 04.06.2025.
It is evident that the detenue was produced before the jurisdictional Magistrate at 9:25 PM on 05.06.2025 i.e. beyond the stipulated period of 24 hours which is in direct contravention of his fundamental rights under Article 22 of the Constitution of India - However, before passing any orders, an opportunity is afforded to respondents No. 2 and 3 to show cause as to why contempt proceedings may not be initiated against them for snatching papers from the Warrant Officer and obstructing him from performing his official duty. This Court cannot turn a Nelson’s eye to such recalcitrant misconduct depicting a blatant disregard for the rule of law. Allowing such lawless to continue unchecked would undermine the authority and dignity of the justice administration mechanism.
The respondent No. 3-Additional Director General GST is directed to file his affidavit indicating: (i) Complete details regarding names of the officials of the Department along with their designations, who were present at Central Revenue Building, Sector 17, Chandigarh from 06:30 PM to 09.00 PM on 05.06.2025 (ii) Status of installation of CCTV cameras at the premises of Central Revenue Building, Sector 17, Chandigarh.
Adjourned to 18.07.2025.
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2025 (7) TMI 326
Seeking recall of the Order vide which Bail has been granted to the Respondent - evasion of CGST running into crores of rupees - bail was granted on the third Bail Application merely after a month of rejection of second Bail Application, when there was no change of circumstances - HELD THAT:- The Respondent has sufficiently explained that the Complaint got filed against him on 04.12.2020 and filing of the Chargesheet in itself was a complete change in circumstances.
As held in the case of Laxman Irappa Hatti [2004 (7) TMI 698 - BOMBAY HIGH COURT] the considerations for grant of Bail at the stage of investigation which are material is whether the accused would present himself for investigation and cooperate in the investigations and that he would not hamper the investigations or tamper with the evidence of witnesses.
However, once Chargesheet gets filed, these considerations fade into the background and what is now material is to consider the gravity of the offence along with the Triple Test viz. whether he is a flight risk or he would be influence the witnesses or tamper with the evidence.
In the present case, it cannot be overlooked that the evidence in the present case, is essentially documentary and there is no likelihood of the same being tampered by the Respondent after having been admitted to Bail. There is nothing to show that he is a flight Risk or there is any likelihood of his influencing the witnesses. The discretion has been rightly exercised by the learned CMM, while granting the Bail.
In the present case, there is no ground which is existing to show that the discretion of grant of Bail has not been exercised judiciously by the learned CMM or that there is any misuse or abuse of liberty so granted by the Respondent. There is also nothing on record to show that the trial has been hampered on account of grant of Bail.
There is no merit in the present Petition for recall of the Bail Order - petition dismissed.
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2025 (7) TMI 325
Grant of bail - fraudulent availing of Input Tax Credit (ITC) on the basis of ineligible or non-genuine Invoices issued by entities - distinction between challenging the Bail Order on merits and cancellation of Bail - HELD THAT:- The Recall of bail Order essentially on the ground that the requisite factors have not been considered and discretion to grant Bail has been exercised incorrectly. However, while seeking Cancellation, it is on the ground of violation of the conditions imposed while granting Bail.
This distinction is succinctly brought forth in the case of Mahipal vs. Rajesh Kumar @ Polia and Anr [2019 (12) TMI 1461 - SUPREME COURT], wherein the Apex Court observed that the considerations that guide the power of an Appellate Court in assessing the correctness of an order granting Bail stand on a different footing from an assessment of an application for the cancellation of Bail. The correctness of an order granting Bail is tested on the anvil of whether there was an improper or arbitrary exercise of the discretion in the grant of bail. The test is whether the order granting Bail is perverse, illegal or unjustified.
The circumstances and consideration of both is therefore, distinct and must not be confused, when the Bail Order is sought to be recalled. The present case is of the former category wherein Bail granted vide Order dated 17.10.2020, is sought to be recalled on the ground of the discretion having been erroneously exercised in favour of the Respondent - In the present case, it cannot be overlooked that the evidence is essentially documentary/electronic and there is no likelihood of the same being tampered by the Respondent after having been admitted to Bail. There is nothing to show that he is a flight Risk or there is any likelihood of his influencing the witnesses or tampering the evidence.
The legal position is well-established that once Bail has been granted through a well-reasoned Order, it cannot be revoked lightly or without substantial new evidence against the accused. The Petitioner has failed to demonstrate any “cogent and overwhelming circumstances” as mandated for Bail cancellation - Furthermore, it cannot be ignored that the Bail was granted vide Order dated 17.10.2020 and there is no averment of any misuse or abuse of the liberty of Bail as granted to the Respondent. There is no ground which is existing to show that the discretion of grant of Bail has not been exercised judiciously by the learned CMM or that there is any misuse or abuse of liberty so granted by the Respondent. There is also nothing on record to show that the trial has been hampered on account of grant of Bail.
There is no merit in the present Petition for recall of the Bail Order - Petition dismissed.
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2025 (7) TMI 324
Condonation of delay in filing appeal - Dismissal of appeal on the ground that the same was not filed within the prescribed time limit as provided under Section 107 (4) of CGST Act, 2017 - HELD THAT:- The issue as to whether the provisions of Section 5 of the Limitation Act shall be applicable for condonation of delay in preferring an appeal under Section 107 of the 2017 Act was considered by this Court in ABDUL AZIZ SARKAR [2025 (4) TMI 1660 - CALCUTTA HIGH COURT] wherein this Court held that 'since provisions of Section 5 of the Act of 1963 have not been expressly or impliedly excluded by Section 107 of the Act of 2017 by virtue of Section 29(2) of the Act of 1963, Section 5 of the Act of 1963 stands attracted.'
Thus it is well settled that in the absence of specific exclusion of Section 5 of the Act of 1963 it would be improper to read an implied exclusion thereof.
By applying the ratio laid down by the Hon’ble Division Bench in S. K. Chakraborty and Sons [2023 (12) TMI 290 - CALCUTTA HIGH COURT], this Court is of the considered view that the appellate authority was not justified in rejecting the appeal petition solely on the ground that the same was filed beyond the maximum period of four months.
This Court is inclined to interfere with the order passed by the appellate authority thereby rejecting the appeal on the ground of limitation - the application for condonation of delay is restored to the file of the appellate authority.
The impugned order set aside - application disposed off.
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2025 (7) TMI 273
Cancellation of GST registration of the petitioner - cancellation for the reason of auto-generated details of your inward supplies for the period from 13.09.2022 to 20.09.2022 - HELD THAT:- Considering that the grievances in this writ petition is for a direction to revoke the cancellation of the GST registration and on payment of the tax amount due to the petitioner and also taking note in M/S. W.G. RESORTS (ASSAM) PRIVATE LIMITED VERSUS UNION OF INDIA AND 3 ORS [2022 (9) TMI 1668 - GAUHATI HIGH COURT] covers the case of the petitioner. Accordingly, this writ petition is disposed of by directing the respondent authorities to restore the GST registration of the petitioner on filing the return along with the deposit of the statutory dues by the petitioner in accordance with the applicable Rules.
The revocation of the cancellation of GST registration shall be carried out as expeditiously as possible but not later than 25 days from today and the respondent No. 3 shall intimate the petitioner as regards the outstanding statutory dues as payable so as to enable the petitioner to file return, if any. It is made clear that similar benefit is granted to the petitioner subject to the payment of all the dues including prior to cancellation of GST registration.
Petition disposed off.
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2025 (7) TMI 272
Maintainability of petition - petition dismissed on the ground that an effective alternate remedy is available to the appellant as against the order of adjudication passed by the adjudicating authority by filing an appeal before the Commissioner, Central Tax (Appeal) - HELD THAT:- It is well settled that the rule of not entertaining an application under Article 226 of the Constitution of India when a statutory appellate remedy is available is not rigid rule but an exception can be curbed out for the said rule and the Hon’ble Supreme Court in several decisions have curbed out such exceptions.
It is not in dispute that the appellant was given adequate opportunity to put forth its submissions even prior to the show cause notice when statements were recorded and after the show cause notice was issued, reply was submitted and the matter was adjudicated following the provisions under the Act - it cannot be stated to be a case where there has been violation of principles of natural justice.
There are no grounds to interfere with the order passed by the learned Single Bench - appeal dismissed.
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2025 (7) TMI 271
Challenge to order of cancellation of registration of the petitioner - appeal belatedly filed by the petitioners - HELD THAT:- Admittedly, it is found that the registration of the petitioner had been cancelled on the ground of non-filing of returns. It is not the case of the respondents that the petitioner had been adopting dubious process to evade tax. Taking note of the fact that the suspension/revocation of license would be counterproductive and works against the interest of the revenue since, the petitioner in such a case would not be able to carry on his business in the sense that no invoice can be raised by the petitioner and ultimately would impact recovery of tax, the respondents should take a pragmatic view in the matter and permit the petitioner to carry on its business.
It is found from the submissions made by the respondents that unless, the petitioner files its returns, the respondents cannot determine the final liability.
Having regard to the aforesaid and taking note of the direction issued by the Hon’ble Division Bench of this Court in the case of Subhankar Golder [2024 (5) TMI 1262 - CALCUTTA HIGH COURT], it is proposed to set aside the order dated 6th August 2024 cancelling the registration of the petitioner subject to the condition that the petitioner files its returns for the entire period of default and pays requisite amount of tax and interest and fine and penalty. As a sequel thereto, the order passed by the Appellate Authority on 21st March 2025 is also set aside.
Application disposed off.
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2025 (7) TMI 270
Challenge to assessment order - discharge of tax liability and interest after suffering impugned assessment order - settlement of case under amnesty scheme - HELD THAT:- Considering the fact that the petitioner has also discharged the tax liability and interest, Court is inclined to balance the interest of the revenue as also the petitioner by remitting the case to the first respondent re-consider the impugned order insofar as the imposition of penalty under Section 74 of the respective GST enactment alone.
Petition disposed off.
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2025 (7) TMI 269
Challenge to impugned order which preceded the SCN - HELD THAT:- The impugned order is set aside and the case is remitted back to the respondent to pass fresh orders on merits, after considering the order, that came be passed on 12.02.2025, pursuant to the Show Cause Notice, dated 15.03.2024.
Petition disposed off.
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2025 (7) TMI 268
Violation of principles of natural justice - proper service of SCN or not - SCN were issued prior to passing the Impugned Order under Section 73 (9) of the State Act or not - determination of tax as well as the Order attached to the Summary of the Show Cause Notice in GST DCR-01 and Summary of the Order in GST DCR-07 can be said to be the Show Cause Notice and Order respectively or not - impugned orders under Section 73 (9) of the State Act is in conformity with Section 75(4) of the State Act and is in consonance with the principles of natural justice.
HELD THAT:- The Proper Officer is mandated to issue a SCN only under specific circumstances as outlined in Section 73. Therefore, the SCN must clearly state the reasons and circumstances justifying its issuance under this section. Only then can the recipient effectively respond, particularly if they wish to challenge the applicability of Section 73. Section 73(9) requires the Proper Officer to determine the tax, interest, and penalty after considering the representation. Section 73(2) and 73(10) are interconnected, while Section 73(10) allows passing the order within three years from the due date of the annual return, Section 73(2) mandates that the SCN must be issued at least three months before the deadline. Furthermore, a combined reading of subsections (1) to (4) of Section 73 shows that the legislature has made a clear distinction between a Show Cause Notice and a Statement. Even if a Statement is issued under Section 73(3), a separate and proper SCN is still required.
From a perusal of Rule142, it would show that in addition to the Show Cause Notice to be issued under Section 73 (1) and the Statement of determination of tax under Section 73 (3), there is an additional requirement of issuance of a Summary of the Show Cause Notice in GST DRC-01 and the Summary of the Statement in GST DRC-02. The natural corollary from the above analysis is that the issuance of the Show Cause Notice and the Statement of determination of tax by the Proper Officer are mandatory requirement in addition to the Summary of Show Cause Notice in GST DRC-01 and Summary of the Statement in GST DRC-02.
The Division Bench of the Hon’ble Jharkhand High Court in Nkas Services Pvt. Ltd. [2022 (2) TMI 1157 - JHARKHAND HIGH COURT] held that a summary in GST DRC-01 cannot replace a proper SCN. Similarly, in LC Infra Projects Pvt. Ltd. [2019 (8) TMI 84 - KARNATAKA HIGH COURT], the Honble Karnataka High Court emphasized that issuing a proper SCN is essential before the recovery of interest or penalty under the Act.
The Court holds that merely attaching a tax determination order to the summary in DRC-01 does not amount to valid initiation under Section 73. The summary is only supplementary to a full SCN. Thus, the impugned orders, having been passed without a proper SCN, are in violation of Section 73 and Rule 142(1)(a).
Whether the determination of tax as well as the order attached to the Summary to the Show Cause Notice in GST DRC-01 and the Summary of the Order in GST DRC-07 can be said to be the Show Case Notice and Order respectively? - HELD THAT:- As per Section 2(91), a Proper Officer is the Commissioner or someone entrusted by him. Therefore, unless these documents are duly authenticated by the Proper Officer, they fail to meet the statutory requirements and are rendered invalid and unenforceable. Section 73 of the Act requires that notices and order be issued by the Proper Officer but it does not prescribe the mode of authentication outside Chapter III of the Rules. Since no specific rule under Chapter XVIII (relating to Demand and Recovery) governs authentication, a regulatory gap exists. Given the critical importance of authentication by the Proper Officer, the Court held that, until proper rules or notifications are issued by the Board to address this gap, Rule 26(3), which requires digital or e-signature, must be applied by default. This ensures that any notice, statement or order issued under the Act maintains its legal validity and enforceability.
On the question of whether the impugned orders under Section 73(9) conform to Section 75(4) of the State Act and is according to the principles of natural justice, the Court observed that the Summary of the Show Cause Notice did not mention any date of hearing, leaving the relevant column blank. The petitioner was merely asked to submit a reply, without being offered a cleared opportunity for personal hearing.
This Court also notes that the impugned order contravenes Section 75(4) of the Act which mandates that the impugned order contravenes Section 75(4) of the Act, which mandates that a reasonable opportunity of hearing must be provided either when an adverse decision is contemplated or when a written request is made by the assessee. In the present case, although the DRC-01 summary specifies the date for filing a reply, it leaves the fields regarding the date and time of personal hearing as “NA”. In a situation where no reply is submitted, the Proper Officer cannot proceed to pass an adverse order without granting an opportunity of hearing, as doing so would render the safeguards under Section 75(4) ineffective and violate principles of natural justice.
The impugned order dated 19.12.2023 is interfered with and set aside - Petition allowed.
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2025 (7) TMI 267
Dismissal of rectification application filed by the petitioner - entitlement to ITC - HELD THAT:- Having perused the impugned orders and the amendments to Section 16 of the TNGST Act / CGST Act, 2017 in the year, it is opined that the petitioner has made out a good case for interference, although the submission of the learned counsel for the petitioner that the petitioner has no right to work out the appellate remedy in view of Section 14 of the Limitation Act, 1963 will gain some rigor in favour of the petitioner.
However, it is noticed that the rectification application filed by the petitioner against the assessment order dated 15.08.2024 has been rejected summarily without any discussion. Therefore, there is no other option but to quash the order dated 11.03.2025, impugned in W.P. (MD) No.16344 of 2025, with a direction to the respondent to pass a fresh order after considering the submissions of the petitioner on merits.
Petition disposed off.
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2025 (7) TMI 266
Rejection of application for rectification - thogh the petitioner replied to SCN, the impugned order states that the petitioner has not replied to the same - HELD THAT:- The petitioner has made out a case for interfering with the impugned order, as the impugned order clearly records that the petitioner has not replied, even though the petitioner has indeed replied on 22.01.2025, which has been duly acknowledged in Form GST DRC 06.
The impugned order is quashed and the case is remitted back to the respondent to pass a fresh order on merits and in accordance with law, as expeditiously as possible, preferably within a period of three months from the date of receipt of a copy of this order. Needless to state, before passing final orders, the reply of the petitioner shall be considered and the petitioner shall also be heard.
Petition allowed by way of remand.
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2025 (7) TMI 265
Dropping of penalty - petitioner has voluntarily paid the payment of penalty - HELD THAT:- The facts are not disputed that the petitioner had violated the conditions prescribed under Section 129 of the respective GST enactments. Therefore, the petitioner was indeed liable to be proceeded under Section 129 of the respective GST enactments and however, the question is as to whether the penalty that is imposed is to be justified or lesser penalty is to be imposed.
Reading of the Section 129 indicates that lesser penalty can be imposed. Considering the fact that there is no dispute that the petitioner has indeed exported the goods, it is opined that the export incentive cannot be denied for technical and venial breach of provisions of Section 129 of the respective GST enactments as held by the Hon’ble Supreme Court in Hindustan Steel Ltd vs. State of Orissa [1969 (8) TMI 31 - SUPREME COURT]
Under these circumstances, although the petitioner has an alternate remedy, this Court is of the view that there is no point in relegating petitioner to work out its remedy by the Appellate Authority under Section 107 of the respective GST enactments, as export incentives are not to be denied, although there may be certain technical and venial breach by exporter.
This Writ Petition is allowed, by directing the respondents to appropriate Rs. 25,000/- itself from the amount that was already paid by the petitioner and to allow the petitioner to adjust the balance amount against the future tax liability of the petitioner.
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2025 (7) TMI 264
Blocking of Electronic credit ledger of the petitioner - before passing the impugned order, pre-decisional hearing was not provided to the petitioner nor does the impugned order contain any reason to believe as to why it was necessary to block the Electronic credit ledger - violation of principles of natural justice - HELD THAT:- In K-9-Enterprises [2024 (10) TMI 491 - KARNATAKA HIGH COURT], the following points were answered in favour of the petitioner- assessee by holding that 'The aforesaid facts and circumstances are sufficient to come to the unmistakable conclusion that in the absence of valid nor sufficient material which constituted ‘reasons to believe’ which was available with respondents, the mandatory requirements/pre- requisites/ingredients/parameters contained in Rule 86A had not been fulfilled/satisfied by the respondents- revenue who were clearly not entitled to place reliance upon borrowed satisfaction of another officer and pass the impugned orders illegally and arbitrarily blocking the ECL of the appellant by invoking Rule 86A which is not only contrary to law but also the material on record and consequently, the impugned orders deserve to be quashed.'
In the instant case since no pre-decisional hearing are provided/granted by the respondents before passing the impugned order, coupled with the fact that the impugned order invoking Section 86A blocking of the Electronic credit ledger of the petition does not contain independent or cogent reasons to believe/accept by placing reliance upon reports of enforcement authority which is impermissible in law, since the same is on borrowed satisfaction as held by Division Bench, the impugned order deserves to be quashed.
The concerned respondents are directed to unblock the Electronic credit ledger of the petitioner immediately upon the receipt of copy of this order, so as to enable the petitioner to file returns forthwith - the impugned order is quashed - petition allowed.
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2025 (7) TMI 263
Taxability - Subsidised Canteen Charges - Eligibility to Claim Input Tax Credit.
Taxability of Subsidised Canteen Charges - HELD THAT:- Coming to Treatment of Contract and Regular Employees in Canteen GST Exemption, under Section 46 of the Factories Act, 1948, any factory employing more than 250 workers is mandated to provide and maintain a canteen for the use of workers. Importantly, the definition of “worker” in Section 2(1) of the Act includes any person employed directly or by or through any agency (including a contractor) to work in a manufacturing process. Thus, the obligation to provide canteen facilities extends not only to employees on the rolls but also to contract labour engaged in factory operations. There is no distinction in the statutory language that exempts employers from extending canteen benefits to contract workers.
The Hon'ble Supreme Court in NTPC Ltd. v. Karri Pothuraju & Others [2003 (8) TMI 595 - SUPREME COURT] held that contract workers employed in the premises of the principal employer fall within the scope of “worker” under the Factories Act and are entitled to statutory welfare measures, including canteen facilities.
From a GST perspective, CBIC Circular No. 172/04/2022-GST dated 06.07.2022 clarifies that any perquisite provided by an employer in terms of a contractual obligation (including those arising from statutory mandates) is not a “supply” under Section 7 of the CGST Act. Therefore, once canteen facilities are extended as part of legal obligations applicable to all “workers”-whether regular or contractual-the perquisite assumes the character of employment-related welfare and cannot be taxed, even if a partial cost recovery is made.
Therefore, excluding contract employees from the GST exemption would create an artificial and unlawful classification contrary to the spirit of the Factories Act and the judicial interpretation of “worker.” The legal and policy framework clearly supports uniform treatment of all workers, whether permanent or contract, when it comes to statutory canteen facilities.
Eligibility to Claim Input Tax Credit - inward supplies used in the canteen for supplying food to the employees - HELD THAT:- The Proviso to Section 17(5)(b)(i) of the CGST Act, 2017 allows Input Tax Credit (ITC) where the provision of food or beverages is a statutory obligation, and it does not make ITC eligibility conditional upon the manner in which consideration, if any, is received from employees. Whether the employer bears the entire cost, or recovers it partially or fully from employees, has no bearing on ITC entitlement. The canteen facility as previously discussed arises from the employer-employee relationship and qualifies as a perquisite under that relationship. The law does not require that such services be provided free of cost, and the availability of ITC remains independent of whether the transaction results in reimbursement or not. The eligibility for ITC comes purely by virtue of the fact that the provision for canteen facility is a statutory obligation and there does not seem to be any ground to disallow the ITC benefit, provided the facility is in pursuance to a statutory obligation and that GST liability has not been passed on to the employees of the company.
Thus, full ITC on inward supplies used in the statutory canteen is admissible, irrespective of whether the applicant recovers any portion of the food cost from its employees.
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2025 (7) TMI 206
Maintainability of petition - availability of alternative remedy - Cancellation of the Petitioner’s registration under the Maharashtra Goods and Services Tax Act, 2017 - Vague and bereft SCN - Violation of principles of natural justice - HELD THAT:- The show cause notice refers to Section 29(2)(e) and states that registration was obtained by means of fraud, willful misstatement or suppression of facts. Although a time limit was granted to file a reply and the Petitioner was informed that if he failed to appear for a personal hearing on the appointed date and time, the case would be decided ex parte, the show cause notice at Exh-B does not specify this appointed date or time.
Merely quoting a Section and alleging that registration has been obtained through fraud, willful misstatement, or suppression of facts in a show cause notice is never enough. The noticee must be given an idea of what the alleged fraud, misstatement, or suppression of facts was. Only then will the noticee be able to understand the allegations against them and respond effectively.
Regarding the alternative remedy, the objections are typically entertained and the parties are directed to pursue the statutory remedies available. However, it is well established that in cases of a gross breach of principles of natural justice, petitioners should not be relegated to the alternative remedies. The concern is not primarily with the final decision but with the fairness of the decision-making process itself. Any process that is not underpinned by natural justice renders the final decision susceptible to challenge. This stands as a notable exception to the rule of not entertaining petitions where effective alternative remedies are available.
The impugned order is set aside - petition allowed.
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