Case Law Details
Vivo Mobile India Private Ltd. Vs Union of India (Allahabad High Court)
1. Heard Sri Tarun Gulati, learned Senior Counsel assisted by Sri Nishant Mishra, Sri Kishore Kunal, and Ms. Vedika Nath, learned counsel for the petitioner, Sri Gaurav Mahajan, learned counsel for Central Board of Indirect Taxes, Sri Manish Goyal, learned Additional Advocate General assisted by Sri Nimai Dass, learned Additional Chief Standing Counsel and Sri Ankur Agarwal, learned Standing Counsel for the State of Uttar Pradesh.
2. Present petition has been filed for various reliefs described in the prayer clause. At the same time, after exchange of affidavits and, upon the matter being heard, prayer nos. B, C and D alone have been pressed. Other prayers have not been pressed, at this stage. Thus, the challenge raised to the vires of Rule 36(4) of the Central Goods and Services Tax Rules, 2017 (hereinafter referred to as the ‘CGST Rules, 2017‘), has been specifically given up, at this stage.
3. Primary relief being sought by the petitioner is against the order dated 7.4.2021 passed by the Deputy Commissioner, Sector-2, Commercial/State Tax, Gautam Buddh Nagar. By that order, passed under Section 74 (9) of the CGST Act, 2017 (hereinafter referred to as ‘the Act’), the said authority has opined that the petitioner had availed/utilised excess Input Tax Credit (ITC in short), Rs. 110,06,90,100.31, for the months of February 2020 to August 2020. Construing the same to be a violation of Rule 36(4) of the CGST Rules, 2017, it has been directed to be reversed and added to the output tax liability of the petitioner, with consequent interest obligation. Also, an equal amount of penalty referable to Section 74 of the Central Goods and Service Tax Rules, 2017 has been imposed. Thus, total demand of Rs. 235.52 crores had been created – inclusive of interest @ Rs. 15,40,00,000/-. Against that demand, the petitioner had self-deposited Rs. 11,00,69,010/- (provisionally, pending this writ petition) being 10% of the disputed demand of tax. However, it has disputed the entire liability.
4. Upon the present petition being entertained, initially, affidavits were called. However, the stay application remained pending. Meanwhile, the respondents recovered the entire amount of tax, Rs. 110,06,90,100.31 and equal amount of penalty, excluding interest. Thus, notwithstanding the pre-deposit Rs. 11,00,69,010/- made (provisionally, pending this writ petition), further Rs. 220,13,80,200.60 were recovered. Later, by order dated 21.9.2022, interim protection was granted to the following effect:
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