LANDMARKS JUDGMENT ON RECOVERY IN GST LAWS

LANDMARKS JUDGMENT ON RECOVERY IN GST LAWS

Thoughts, Insight and Research by: Abhishek Raja Ram, 9810638155

Let's dive deep and understand the power of GST Department in recovering amount from the assessee along with the procedures as established by various court judgments.

1. CHAIZUP BEVERAGES LLP - Madras High Court

(2019) 25 GSTL 26

Deemed stay on making mandatory pre-deposit. Petitioner having filed appeal against demand confirmed in adjudication with 10% mandatory pre-deposit, demand of balance amount is deemed stayed in terms of statutory provisions. Therefore, adjustment of refund against demand amount on the ground that no specific stay granted, not sustainable - Refund be disbursed within 3 weeks.

2. Penna Cement Industries Ltd. - Andhra Pradesh High Court

(2024) 84 GSTL 507

Where liability for taxes under Section 16 of CGST Act against assessee was confirmed, subsequent recovery notice issued before expiry of statutory limitation period for filing appeal was not sustainable, since assessee wanted to file appeal against demand, assessee was to be allowed to file appeal.

3. Tvl. GRB Dairy Foods Pvt. Ltd. - Madras High Court

(2020) 32 GSTL 514

A demand notice for tax, interest, and penalties was issued within 10 days of the assessment order. However, the period prescribed for filing an appeal against such assessment order is three months.

Author's View:

In case 2 & 3 the demand notice proceedings were deferred until the statutory deadline, highlighting the department's unnecessary eagerness to recover money, even when it is not due.

4. Tvl. Arun Medicals - Madras High Court

(2024) 24 CENTAX 59

Orders passed based on show cause notice uploaded only on GST portal without physical service to assessee whose GST registration stood cancelled, set aside for violation of natural justice principles.

5. Prasanna Karunakar Shetty - Bombay High Court

(2024) 17 CENTAX 418

Where recovery proceedings against assessee was initiated without issuing any show cause notice or granting opportunity of being heard to assessee and impugned order was passed attaching bank account of assessee, such order was in violation of section 14 and 300A of constitution of India, thus same was to be set aside.

I hope you will find this useful.

Warm Regards,

Abhishek Raja Ram

9810638155