Eastland Switchgears Pvt. Ltd. & Anr. Vs Assistant Commissioner of Revenue & Ors. (Calcutta High Court)
In the case Eastland Switchgears Pvt. Ltd. & Anr. Vs Assistant Commissioner of Revenue & Ors., the Calcutta High Court addressed the validity of a GST show-cause notice issued to the petitioner. The notice pertained to the alleged short payment of tax on commission income amounting to ₹16,56,267, received from PT Jembo Cable Company. The petitioner claimed the commission income was exempt under Entry No. 12AA of Notification No. 9/2017-IGST (R), which exempts intermediary services provided between parties outside the taxable territory. The petitioner submitted all requisite documents to substantiate the exemption claim but argued that the authorities failed to provide a reasoned denial of the exemption in their audit findings or pre-show-cause notice reply.
The Court, however, ruled that the show-cause notice was lawfully issued and constituted a critical step in the tax adjudication process. It emphasized that the petitioner would have the opportunity to present further submissions and evidence during the adjudication. The Court declined to intervene at this preliminary stage, stating that the adjudicating authority must decide on the applicability of the exemption based on the petitioner’s submissions. The petition was thus disposed of, with directions for both parties to adhere to the adjudication process while ensuring principles of natural justice.
