In a recent legal case, Sri Nishant Mishra and Sri Ankur Agarwal were lawyers representing different sides. The case revolved around an order issued on 17th April 2023 by Deputy Commissioner, State Tax, labeled as Respondent No.2. This order confirmed a demand for recovering input tax credit (ITC) amounting to Rs. 3,13,68,997/-, which the petitioner had claimed between September and November 2017. The main issue was whether the petitioner's use of Form GST-3B for ITC transfer was valid, or if it should have used GST ITC-02.
The petitioner was a registered company providing internet services across India, including Uttar Pradesh. In August 2017, they had acquired a business from another company, M/s Tikona Digital Network Pvt. Ltd. This previous company had unutilized ITC of over Rs. 3,13,68,997/-, which the petitioner was entitled to transfer according to Section 18(3) of the GST Act. However, due to the unavailability of Form GST ITC-02 on the government portal, the petitioner resorted to using Form GST-3B for the transfer.
Despite informing the relevant authorities about the unavailability of the proper form, the petitioner didn't receive a response. Facing financial challenges, they manually adjusted the ITC in their account. Five years later, they received a show cause notice in February 2023, asking them to pay back part of the ITC along with additional charges. The petitioner responded with a detailed explanation, urging the withdrawal of the notice. However, the Deputy Commissioner passed an order on 17th April 2023 confirming the demand without considering the petitioner's reply.
The case was heard, with both lawyers presenting their arguments. Sri Nishant Mishra argued that the order was based on technicalities and didn't consider the petitioner's objections. Sri Ankur Agarwal, representing the Revenue, defended the order, stating that the objections were acknowledged and the petitioner hadn't availed the opportunity for a personal hearing.
The court noted that the petitioner's predicament arose due to the unavailability of Form GST ITC-02 on the government portal during the initial months of its implementation in July 2017. The court suggested that the petitioner should have raised their concern with the GST portal help-desk and waited for the form to become available instead of making an improper adjustment.
Ultimately, the court ruled in favor of the petitioner, concluding that the order was unjust due to the unavailability of the required form. The court set aside the order, giving the authorities the chance to reevaluate the case, considering the petitioner's objections and allowing for a proper hearing.
In conclusion, this case highlights the importance of adhering to proper procedures and forms in financial matters, even amidst challenges. The court's decision emphasizes the need for a fair and balanced approach to legal proceedings, where both sides are heard and considered, ensuring justice prevails.
Topic-Tikona Infinet Private Limited versus State of UP
Court-ALLAHABAD HIGH COURT
Dated -25/07/2023
Team Taxonation
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