Prem Highway Services Vs Union of India (Patna High Court)
Summary: The petitioner, M/S Prem Highway Services, a dealer in petroleum products, challenged the adjudication order dated 29.04.2024 imposing tax liability of Rs. 1,25,71,936/-. The petitioner contended that it dealt in Motor spirit and High-speed diesel, which were non-GST items and continued to be taxable under the earlier VAT regime, as GST levy on such petroleum products under Section 9(2) of the CGST/BGST Act was subject to issuance of the requisite notification. It was further submitted that the petitioner had filed its return for 2018-19 and that the Assessing Authority had exceeded its jurisdiction by assessing tax on invoices relating to Motor spirit and High-speed diesel.
The State opposed the writ petition, submitting that the petitioner had neither responded to the show cause notice nor produced documents establishing that the invoices related to non-GST items, and further contended that the impugned order also imposed tax on some GST items. The Patna High Court noted that the petitioner had produced its Registration Certificate and tax invoices in support of its claim.
The Court observed that Motor spirit and High-speed diesel were non-GST items and that it appeared that the Adjudicating Authority had imposed tax liability upon such items. According to the Court, imposing tax liability on non-GST items travelled to the root of the matter. Despite the delay in approaching the Court, the writ application was entertained because the Court found, prima facie, that the Adjudicating Authority lacked jurisdiction to impose GST upon the non-GST items.
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