Haier Appliances India Pvt Ltd Vs Union of India & Ors. (Delhi High Court)
The petitioner is a leading manufacturer of electrical appliances. It filed Form Trans-1 for transition into GST regime. The credit lying at the Input Service Distributor (ISD) was also transitioned. The Revenue objected and proposed to deny credit of over Rs.17 crores on the ground that there was no mechanism for transition of credit lying with ISD. Demand was confirmed along with interest and penalties. Such order was challenged in writ petition.
The Hon’ble Delhi High Court set aside the order and allowed the writ petition. It took note of the amendment brought to section 140(7) which has been introduced retrospectively. It held that the authorities need to examine the application of the said provision. Following similar route adopted by the Bombay High Court in Merck Life science case; remands matter back keep all other contentions open.
The matter was argued by Ld. Counsel Bharat Raichandani along with Deepak Kumar Khokhar and Annweshaa Laskar.
FULL TEXT OF THE JUDGMENT/ORDER OF DELHI HIGH COURT
1. This writ petition has been preferred seeking the following reliefs:-
“a) that this Hon’ble Court be pleased to issue a Writ of Certiorari/Mandamus or a writ in the nature of Certiorari/Madamus or any other writ, order or direction under Article 226 of the Constitution of India calling for the records pertaining to the Petitioner’s case and after going into the validity and legality of the provisions quash and set aside the impugned order dated 08.03.2024;
b) that this Hon’ble Court be pleased to issue a Writ of Certiorari/Mandamus or a writ in the nature of Certiorari/Mandamus or any other writ, order or direction under Article 226 of the Constitution of India calling for the records pertaining to the Petitioner’s case and after going into the validity and legality of the provisions quash and set aside the impugned show cause notice dated 25.08.2023;
c) that this Hon’ble Court be pleased to issue a Writ of Certiorari or a writ in the nature of Certiorari or any other writ, order or direction under Article 226 of the Constitution of India calling for the records pertaining to the Petitioner’s case and after going into the validity and legality of the provisions direct the respondent no. 2 to drop the proceedings in terms of the impugned order dated 08.03.2024;
d) that this Hon’ble Court be pleased to issue a Writ of Certiorari or a writ in the nature of Certiorari or any other writ, order or direction under Article 226 of the Constitution of India allowing the transition of ISD credit amounting to Rs. 17,46,98,546/-;
e) that this Hon’ble Court be pleased to issue a Writ of Certiorari or a writ in the nature of Certiorari or any other writ, order or direction ordering and directing the Respondent No. 2 by himself, his subordinates, servants and agents, pending disposal of the present petition not to enforce any action and/ or recovery under the impugned order passed by the Respondent No.2;
f) for ad-interim reliefs in terms of prayers above;
g) for costs of this Petition;
h) for such further and other reliefs as the nature and circumstances of the case may require.”
2. Before us, learned counsels for parties are ad idem that consequent to the amendment of Section 140 of the Central Goods and Services Tax Act, 2017 (CGST Act) which has come to be introduced by virtue of Finance Act No.(2) of 2024, the impugned order would be liable to be set aside with liberty being accorded to the respondents to examine the controversy afresh and bearing in mind the statutory amendments which we have alluded to hereinabove.
