TMI Blog2021 (8) TMI 405X X X X Extracts X X X X X X X X Extracts X X X X ..... f 15% of such tax on the basis of his own ascertainment of such tax or the tax ascertained by the proper officer and inform the proper officer in writing of such payment. Sub-Section (9) of Section 74 of the Act enables the proper officer to determine the amount of tax, interest and penalty due from such person and issue an order, if the contents of the notice are disputed. Sub-Section (5) of Section 74 of the Act gives a choice to the tax payer to make any payment, if he is so chooses, but it does not confer any power on the respondents to make a demand as if there has been a determination of liability of the Assessee and demand tax along with interest and penalty - Before ascertainment of liability, the 4th respondent could not have issued the letter dt.25.04.2019 to the petitioner asking him immediately reverse the input tax credit of ₹ 1,52,35,820/- allegedly availed. No tax demand can be issued or raised when investigation is still in progress. The respondents cannot be allowed to put the cart before the horse and collect any tax, interest or penalty before they determine, in an enquiry, after putting the petitioner/assessee of notice - the respondents are restrain ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .01.2021 respectively but admittedly investigation against the petitioner is not complete and no notice under Sub-section (1) of Sec.74 of the Act has been issued to it. Contentions of Counsel for petitioner 5. The petitioner is assailing the conduct of respondents in directing it to remit the amount availed as input tax credit at the stage of summons itself without following due procedure under Section 74 of the CGST Act, 2017 (for short the Act ). 6. Petitioner contends that to buy peace with the respondent and to avoid coercion, petitioner had paid ₹ 10.00 lakhs on 30.04.2019 and ₹ 25.00 lakhs on 13.09.2019 and the respondents are not entitled to make such a demand. 7. According to the Counsel for the petitioner, liability cannot be determined by respondents before conducting enquiry when even the investigation is incomplete; any advise or demand by the respondents 3 and 4 can at best be a provisional one; and when no enquiry has been initiated, petitioner cannot be compelled coercively to pay amounts to the respondents and this violates Art.14 and 300-A of the Constitution of India. I.A.No.1 of 2021 in W.P.No.7063 of 2021 8. On 23.03.2021, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at any tax has not been paid or short paid or erroneously refunded or where input tax credit has been wrongly availed or utilized by reason of fraud, or any wilful-misstatement or suppression of facts to evade tax, he shall serve notice on the person chargeable with tax which has not been so paid or which has been so short paid or to whom the refund has erroneously been made, or who has wrongly availed or utilized input tax credit, requiring him to show cause as to why he should not pay the amount specified in the notice along with interest payable thereon under Section 50 and a penalty equivalent to tax specified in the notice. (2) The proper officer shall issue the notice under sub-section (1) at least 6 months prior to the time limit specified in sub-Section (10) for issuance of order. (3) Where a notice has been issued for any period under sub-Section (1), the proper Officer may serve a statement, containing the details of tax not paid or short paid or erroneously refunded or input tax credit wrongly availed or utilized for such periods other than those covered under sub-Section (1), on the person chargeable with tax. (4) The service of statement under sub-Sectio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reading of the above provision indicates that a notice in sub-Section (1) of Section 74 of the Act may be issued by the proper officer if he is of the opinion that the input tax credit has been wrongly availed or utilized by reason of fraud, or any wilful-misstatement or suppression of facts, to the person who has wrongly availed or utilized input tax credit, requiring him to show cause as to why he should not pay the amount specified in the notice along with interest payable thereon under Section 50 and a penalty equivalent to the tax specified in the notice. Sub-Section (5) of Section 74 of the Act, however, enables the person chargeable with tax to, before service of notice under sub-Section (1) of Section 74, pay the tax along with interest payable under Section 50 and a penalty of 15% of such tax on the basis of his own ascertainment of such tax or the tax ascertained by the proper officer and inform the proper officer in writing of such payment. Sub-Section (9) of Section 74 of the Act enables the proper officer to determine the amount of tax, interest and penalty due from such person and issue an order, if the contents of the notice are disputed. 17. The tenor of the coun ..... X X X X Extracts X X X X X X X X Extracts X X X X
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