Emas Gold And Diamonds LLP Vs Joint Commissioner (Kerala High Court)
The Kerala High Court allowed the writ petition challenging an order passed under Sections 74 and 130 of the Central Goods and Services Tax Act, 2017 (CGST Act), read with Section 67. The petitioners contended that they were denied a proper opportunity to defend themselves because their request to cross-examine witnesses, whose statements formed the basis of the adjudication, was rejected. They also challenged the assessment on the ground that proceedings under Section 74 had been undertaken as a composite or block assessment covering multiple assessment years, contrary to the scheme of the CGST Act.
The first petitioner, a limited liability partnership engaged in the wholesale jewellery business, was subjected to a search on 11.12.2019 under Section 67(2). During the search, gold ornaments, gold pieces, books, documents, computer systems and other devices were seized. The statement of the Chairman was recorded and he was arrested on 16.12.2019. According to the petitioners, statements of employees were recorded while the Chairman remained under detention. A show cause notice dated 19.10.2020 was thereafter issued proposing liability under the CGST Act. In reply, the petitioners disputed the allegations and specifically requested permission to examine and cross-examine the persons whose statements had been relied upon in the show cause notice, asserting that such statements had been obtained under compulsion.
