Forging India Iron And Steel Limited Vs Union of India And Ors. (Calcutta High Court)
The Calcutta High Court addressed two appeals arising from a writ petition filed by Forging India Iron And Steel Limited and another appeal by the Union of India and other departmental authorities. The petitioner challenged specific aspects of the writ court’s order, while the department contested the entire order, which had permitted the cross-examination of one Niraj Kumar Nathani. Both parties presented detailed arguments through their respective legal representatives.
The department’s central argument was that Niraj Kumar Nathani’s statement served merely as corroborative evidence. They contended that substantial independent material, including statements from the appellant company’s directors, unequivocally demonstrated that the Input Tax Credit (ITC) availed by Forging India Iron And Steel was ineligible and based on fraudulent documentation. The department asserted that they could proceed with the case based on this other evidence, irrespective of Nathani’s statement. The memorandum of appeal filed by the Joint Commissioner of Central Tax, Howrah CGST & CX Commissionerate, specifically argued that the writ court should have recognized Nathani’s statement as supplementary to other evidence, including an investigation and inspection report from the Bureau of Investigation, Government of West Bengal, Commercial Taxes, and other documentary evidence considered by the adjudicating authority in its order-in-original dated October 2024.
Considering the department’s stance, the High Court opined that reference to Niraj Kumar Nathani’s statement would be unnecessary if the assessee were to file a statutory appeal before the appellate authority. Furthermore, the court noted the significant number of disputed factual issues involved in the case, deeming it inappropriate for the writ court to adjudicate on these contested facts. Consequently, the High Court concluded that the assessee should be directed to file an appeal before the designated appellate authority, namely, the Commissioner (Appeal) CGST & Central Excise Appeal-II Commissionerate, Kolkata.
In light of these considerations, the Calcutta High Court set aside the impugned order of the writ court. The court directed the assessee, Forging India Iron And Steel Limited, to file an appeal before the appellate authority as per Section 107(1) of the Central Goods and Services Tax (CGST) Act, 2017. The appellate authority was instructed to decide the appeal without considering the recorded statement of Niraj Kumar Nathani. Additionally, the appellate authority is required to adjudicate all other issues presented in the appeal and pass a reasoned order on the merits of the case, in accordance with the law, after granting both parties an opportunity for a personal hearing.
Acknowledging that the statutory deadline for filing the appeal had already passed, the High Court granted the assessee 45 days from the date of receiving the server copy of the order to file their appeal. The court also directed the assessee to comply with the mandatory pre-deposit requirements. Recognizing the potential difficulty in online filing due to the delay, the assessee was permitted to file the appeal manually. The High Court explicitly stated that all issues related to the case were left open for adjudication by the appellate authority. Finally, the observations made by the learned Single Bench in the original impugned order were also set aside. Consequently, both appeals before the Calcutta High Court were disposed of.
FULL TEXT OF THE JUDGMENT/ORDER OF CALCUTTA HIGH COURT
