Advocates:
['RAHUL TAMASKAR', '', 'BHISHMA AHLUWALIA', 'A G']

WPT 67/2022

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NAFR

HIGH COURT of CHHATTISGARH, BILASPUR

WPT

No. 67 of 2022

Judgment reserved on

25

.03.2022

Judgment delivered on

04.05.2022

•

Mahendra Sponge & Power Limited, Registered Office at Plot

No. 76 and 77, Phaseh Siltara Industrial Area, Siltara, Raipur,

Chhattisgarh through its Authorized Signatory Shri Kamlesh

Ghosh, S/o Late Shri S.K. Ghosh, aged about 51 years, R/o

Sai Nagar, Opp. Agricultural College, Raipur, Chhattisgarh

------Petitioner

VERSUS

•

Assistant Commissioner, State Tax (SGST), Circle-9, Raipur,

Civil Lines, Raipur, Chhattisgarh

-------Respondent

For Petitioner : Mr. Bhishma Ahluwalia, Advocate

For Respondent : Mr. Sandeep Dubey, Dy. Adv. Gen. with

Ms. Ruchi Nagar, Dy. Govt. Advocate

S.B.: Hon'ble Shri Parth Prateem Sahu, Judge

C.A.V. Order

1. Petitioner by this writ petition has challenged the impugned order

dated 02.02.2022 passed by appropriate authority under Section

73(9) of Chhattisgarh Goods and Services Tax Act, 2017, making

demand under the “DRC-07”.

2. Mr. Bhishma Ahluwalia, learned counsel for petitioner would

submit that the petitioner is engaged in the business of

manufacturer of iron and steel goods, avails the facilities of Input

Tax Credit (ITC) under the CGST/ SGST laws. Petitioner is

continuously depositing its output tax liabilities making payment

through its cash ledger and credit ledger as mentioned under

Section 49 of the CGST Act. Respondent issued notice under

Section 61 r/w Rule 99(1) in Form GST ASMT-10 dated

WPT 67/2022

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11.08.2021 mentioning that during scrutiny some discrepancies

were noticed and excess credit of ITC of Rs. 27,54,730/- was

availed by the petitioner during the period from 01.04.2019 to

31.03.2020. Respondent has failed to provide details of excess

claim of Input Tax Credit (ITC). On 11.10.2021, Respondent

issued DRC-01 making proposal of payment of Rs. 85,15,273/-

for the aforesaid period without specifying any allegations or

details of excess ITC availed. Thereafter, respondent issued

Show Cause Notice under Section 73 of the CGST/ SGST

without giving details. Petitioner made an application pointing out

that the notice was not proper and detailed show-cause notice be

issued to petitioner. Petitioner, thereafter, filed petition bearing

WPT No 221/2021. Upon hearing, notices were issued to

respondent/ Department and they deliberately not submitted their

reply to the writ petition and passed impugned order. Writ petition

is still pending. The Respondent-department without giving

proper opportunity of hearing, passed the impugned order and

the result of illegal adjudication will follow the illegal recoveries

and may also lead to attachment of bank accounts and debiting

electronic credit ledger of the petitioner. Referring to the

provisions under Section 49, 37 read with Rule 59; Section 38

read with Rule 60 and Section 42 of CGST/ SGST Act, he

submits that the mechanism provided under the aforementioned

provisions of verifying credits are for the purpose of converting

the same from provisional to final was never put in place by the

Government. GSTR-2 and GSTR-3 have been kept suspended

during the entire period after implementation of the new regime

by the Government. The DRC-01 dated 11.10.2021 is not a

show-cause notice as it does not contain all allegations and

WPT 67/2022

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charges based upon which demand of tax is proposed. No

charges have been framed against the petitioner. The notice

under Section 73 issued only reflects the provisions of the

Section and it does not mention any charges against the

petitioner. The order dated 02.02.2022 is in violation of principles

of natural justice. Reasonable and proper opportun