Rathore Building Material Vs Commissioner of State tax (Allahabad High Court)
Introduction: In a significant ruling dated December 1, 2023, the Hon’ble Allahabad High Court addressed the case of M/s. Rathore Building Material v. Commissioner of State tax [Writ Tax No 136 of 2023. The court held that the petitioner, Rathore Building Material, had adhered to the terms of the Show Cause Notice (SCN) by furnishing returns within the stipulated 15 days. Despite compliance, an unwarranted penalty was imposed on the petitioner, rendering the impugned orders contrary to law and non-application of mind.
Facts:
M/s. Rathore Building Material (“the Petitioner”) was served the Show Cause Notice (“the SCN”) under Section 46 of the Central Goods and Service Tax Act, 2017 (“the CGST Act”) by the Commissioner of State Tax (“the Respondent”) where they were asked to furnish returns within 15 days in order to withdraw the proceedings.
Subsequently, the Petitioner furnished the returns within the time prescribed in the SCN. However, the Respondent passed the Order (“the Impugned Order”) imposing penalty under Section 125 of the CGST Act, recorded the date of reply submitted by the Petitioner, and returned the findings stating that no reply was furnished by the Petitioner.
Hence, the Petitioner filed the writ petition before the Hon’ble Allahabad High Court.
Issue:
Whether the penalty be imposed when the Petition complied with the terms of the SCN?
Held:
The Hon’ble Allahabad High Court in the case of Writ Tax No. 136 of 2023 held as under:
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