GST Case Laws 2024: Delhi & Allahabad High Court Key Judgments
Delhi High Court: GST Registration Cancellation Can Be Effective from Date Assessee Sought Cancellation
Case: Chetan Garg v. Sanjeev Sachdeva and Ravinder Dudeja, JJ.
Citation: W.P (C) No. 4509 of 2024 CM APPL. No. 18423 of 2024 (April 05, 2024)
Summary:
The Hon’ble High Court of Delhi directed that GST registration of the assessee was to be treated as cancelled with effect from the date from which the assessee sought cancellation of GST registration, as proceedings under DRC-01 were independent of proceedings for cancellation of GST registration and could continue despite cancellation of GST registration.
Facts of the Case:
In the present case, the assessee filed an application for cancellation of GST registration on the ground that the assessee did not intend to carry on business under said GST number. On the first instance, the application for cancellation was rejected. The assessee again applied for cancellation and filed an instant application seeking direction to the respondents to cancel the GST registration of the assessee.
In response, it was submitted by the department that certain show cause notices were issued to the assessee for financial years 2018-19 to 2023-24, but proceedings were still pending.
Held:
It was held that proceedings under DRC-01 are independent of the proceedings for cancellation of GST registration and can continue despite cancellation of GST registration. The recovery of any amount found due can always be made irrespective of the status of the registration. Thus, merely the pendency of the DRC-01 cannot be a ground to decline the request of the taxpayer for cancellation of the GST registration.
Therefore, the GST registration of the assessee was to be treated as cancelled with effect from the date from which the assessee sought cancellation of GST registration, and it would be without prejudice to the proceedings initiated by the respondents by issuance of DRC-01 for the financial years 2018-19 to 2023-24.
Allahabad High Court: Confiscation and Penalty Based on Estimated Stock Calculation Set Aside
Case: Eco Plus Steels (P.) Ltd. v. State of U.P.
Citation: Shekhar B. Saraf, J. Writ Tax Nos. 916 & 1600 of 2022 (April 12, 2024)
Summary:
The Honorable High Court of Allahabad directed that calculation of stock by the appellate authority on the basis of an estimate was without any basis in law. The entire procedure followed by authorities indicated a lackadaisical approach and showcased incompetence and inefficiency. Therefore, the order related to confiscation and penalty regarding additional stock was to be set aside.
Facts of the Case:
In the present case, the assessee challenged orders passed by the assessing officer and appellate authority regarding confiscation and penalty related to additional stock. The orders had been passed under Section 130 of the Act (confiscation) and Section 122 of the Act (penalty).
Stock was not weighed or counted, specifically when it could have been done on the premises of the assessee.
Held:
It was held that the calculation of stock by the appellate authority on the basis of an estimate was without any legal basis. Confiscation based solely on eye estimation was not permissible under law.
The entire procedure followed by authorities indicated not only a careless approach but also incompetence and inefficiency in the survey, issuance of a show cause notice, and delayed passing of confiscation and penalty orders.
Therefore, the burden of proof for penalty and confiscation lies on the revenue, and estimation could not be a substitute for physical verification. The impugned orders were to be quashed and set aside.