Case Law Details
M/s Commercial Steel Engineering Vs State of Bihar (Patna High Court)
Hon’ble Patna High Court held that ITC availed but not utilized for tax payment doesn’t invite penal consequences of Section 73 of CGST Act, 2017 and interest cannot be recovered on mere availment of ITC which was not utilized
FULL TEXT OF THE HIGH COURT ORDER /JUDGEMENT
The petitioner by filing this writ petition under Article 226 of the Constitution of India has made the following prayer:
“ a) For issuance of a writ in the nature of certiorari for quashing of the order dated 6.11.2018 passed by the respondent no.3 being illegal and without jurisdiction in terms of Section 73(1) of the Bihar Goods and Service Tax Act, 2017 (hereinafter referred to as the Act for short);
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The expression used in the Cenvat Credit rules, 2004 was “availed and utilised”. That means penalty can be imposed if only there are both the activities viz. availment and utilisation. In the GST regime, the expression is “availed or utilised”. The legislative intent is to impose penalty for “availment” itself, even if there is no “utilisation”.
If availment (without utilisation) is not an offence, why Section 122 has stated that penalty is imposable for credit availed or utilised? What is the necessity for the expression ‘availed’? In that case, what does availment mean? High Court can at best declare the usage of the word ‘availed’ as ultravires. In my opinion, High court has wrongly interpreted the meaning of the term ‘availment’.
In the header you say that Patna High Court have ruled that ITC availed but not utilized for tax payment doesn’t invite penal consequences of Section 73 of CGST Act, 2017 and interest cannot be recovered on mere availment of ITC which was not utilized. But in the entire judgement it refers to only Sec 73 of BGST Act. Not CGST Act. So is this judgement valid under GST Act?
Whether this result of writ petition can be applicable to whole India or only to Bihar ?
Thanks in Advance.