Writ Petition: The petition challenges the decision from the GST Council Meeting (dated 17.9.2021) regarding the classification and GST rate for "flavoured and coated illaichi." Also challenged are related clarifications in the Press Release (17.9.2021) and Circular No. 163/19/2021-GST (dated 6.10.2021). The petitioner seeks these to be declared ultra vires to the CGST Act, 2017. The petition further aims to quash show cause notices and restrain the Addl./Joint Commissioner from proceeding with adjudication. A refund of Rs. 5.0 crores deposited during investigation is also requested.
Legal Counsels: Rahul Agarwal and Gaurav Mahajan, along with Dhananjay Awasthi, are the learned counsels for the petitioner and respondents respectively.
Petitioner's Case: The petitioner engages in manufacturing and supplying products like silver coated illaichi, mouth fresheners, and silver coated dates. These products were initially under Chapter 20 of the GST Tariff, taxed at 12%. Despite migration to GST regime, they were classified under the same. The GST Council reclassified them under Chapter 21 with an 18% GST rate. The petitioner argues against this change and claims that the Council lacks authority for such changes.
Matter Under Consideration: The matter is under consideration.
Counter Affidavits: Respondents' counsel is granted four weeks to file a counter affidavit, followed by two weeks for the petitioner to file a rejoinder affidavit.
Next Hearing: The case will be listed after six weeks.
Interim Measure: Considering the petitioner's submissions, an interim measure is decided upon. The operation of the Circular (dated 6.10.2021) and the impugned show cause notices will be stayed if the petitioner deposits Rs. 10 crores within three weeks and provides a bank guarantee for the remaining amount. Adjudication proceedings may continue but won't be implemented without court leave.
Topic-Dharampal Satyapal Limited Versus Union of India
Court-ALLAHABAD HIGH COURT
Date- 21/08/2023
Team Taxonation
