Manoj Kumar Debnath Vs Commissioner of Commercial Taxes And Goods And Services Tax (Orissa High Court)
In the case before the Orissa High Court, the petitioner challenged the authorization issued in Form GST INS-01 dated 18 December 2023 by the Joint Commissioner of State Tax authorizing inspection and search of the petitioner’s premises under Section 67(2) of the CGST/OGST Act, as well as the order dated 1 March 2025 passed under Section 122 read with Section 130 of the GST Act imposing penalty and fine.
The petitioner, a registered dealer engaged in the garment business at Malkangiri, had received a summon under Section 70 of the GST Act on 19 December 2023 requiring personal appearance and production of books of account and evidence.
The petitioner contended that the authorization issued by the Joint Commissioner in Form GST INS-01 did not contain a physical or digital signature and therefore lacked legal sanctity. It was further argued that based on such authorization, the Deputy Commissioner conducted inspection and seized physical stock from the business premises.
The petitioner also challenged the order imposing penalty of Rs.10,01,250 and fine of Rs.43,53,516 under Sections 122 and 130 of the GST Act. It was argued that the authorities had arrived at stock discrepancy figures without conducting proper physical inventory verification and had adopted an irrational and arbitrary method for computation. Reliance was placed on the Allahabad High Court decision in Dayal Product Vs. Additional Commissioner Grade-2 to contend that proceedings under Section 122 read with Section 130 could not be sustained for determining stock discrepancy in such manner.
