Case Law Details
LM Wind Power Blades India Pvt. Ltd. Vs. State of Maharashtra (Bombay High Court)
Learned counsel for the petitioner submits that action of respondent No. 4 in encashing the bank guarantees without waiting for expiry of the appeal period is wholly illegal and should be declared as such by this court. He submits that respondent No.4 has appropriated an amount much more than the demand and penalty put together which is required to be refunded back to the petitioner with applicable interest. Petitioner had paid the IGST and thereafter 30% of the said amount at two stages; firstly 10% while filing the first appeals before the first appellate authority and secondly, 20% at the stage of filing further appeals before the appellate tribunal under Section 112 of the CGST Act and which unfortunately in the State of Maharashtra has not yet been constituted. In the light of the above, he prays for return of the amount covered by the eight bank guarantees and further submitted that petitioner would secure the interest of the revenue by providing fresh bank guarantees to cover the balance amount of penalty imposed.
Learned special counsel representing respondent Nos.1,3 and 4 submits that the bank guarantees had to be invoked under special and compelling circumstances as validity of those were expiring on 31st March, 2019. The above action was done bonafidely to protect the interest of the revenue.
Admittedly, there is IGST demand of Rs. 2,36,63,256.00 with equal amount of penalty imposed, together the total dues comes to Rs.4,73,26,512.00.
The amount covered by the eight bank guarantees is Rs.4,73,26,512.00. If both the figures are added i.e., the amount covered by the bank guarantees and the dues paid by the petitioner, the amount would be Rs.7,80,88,745.00 (Rs.4,73,26,512.00 + Rs.3,07,62,233.00) which amount is now with the respondents as against demand and penalty of Rs.4,73,26,512.00. From the above, it is evident that an amount of Rs.3,07,62,233.00 (Rs.7,80,88,745.00 – Rs.4,73,26,512.00) is lying in excess with the respondents. Even if the appeals filed by the petitioner under section 112 of the CGST Act are dismissed, petitioner would be required to pay a further amount of Rs.1,65,64,279.00 only whereas respondents are holding onto an amount of Rs.3,07,62,233.00 of the petitioner much in excess of the dues.
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