Madras HC Sets Aside GST Orders as Two Assessments Covered Same Tax Period

Andavar Transport Vs Deputy State Tax (Madras High Court)

The Madras High Court set aside two GST assessment orders dated 26.04.2024 and 13.08.2024 relating to the same assessment period after finding duplication between them. The petitioner, engaged in the transportation of goods, submitted that output tax was collected under the reverse charge mechanism (RCM) and that input tax credit (ITC) on vehicle purchases was reflected in GSTR-2A and GSTR-3B.

It was further contended that the ITC had already been reversed from the Electronic Credit Ledger pursuant to the order dated 26.04.2024 and, since such ITC was never utilised, interest under Section 50 of the GST enactments was not leviable. The Government Counsel, on instructions, acknowledged that both impugned orders dealt with the same issues. The High Court held that the duplication alone warranted reconsideration. Accordingly, both orders were set aside and the matter was remanded for fresh consideration after granting the petitioner a reasonable opportunity of hearing. The authority was directed to pass a fresh order within three months.

FULL TEXT OF THE JUDGMENT/ORDER OF MADRAS HIGH COURT

Orders dated 26.04.2024 and 13.08.2024 pertaining to the same assessment period are challenged inter alia on the ground that there is duplication between the two orders.

2. Learned counsel for the petitioner submits that the petitioner is engaged in the business of transportation of goods and that output tax is collected on RCM basis. During the course of purchase of vehicles, he submits that Input Tax Credit (ITC) was shown in the auto populated GSTR 2A and was also reflected in the GSTR 3B return filed by the petitioner. Pursuant to order dated 26.04.2024, he submits that the entire ITC was reversed from the petitioner’s Electronic Credit Ledger. On account of non utilization of such ITC, he submits that interest cannot be levied as per Section 50 of applicable GST enactments.

3. Mr. R. Sethu Prabakaran, learned Government Counsel, appears for the respondents. On instructions, he submits that the issues dealt with in orders dated 26.04.2024 and 13.08.2024 are the same.

4. Thus, there is duplication between the two orders impugned herein. Solely on this ground, re-consideration is warranted. In addition, it appears that the ITC reflected in the Electronic Credit Ledger of the petitioner was reversed pursuant to order dated 26.04.2024

5. For reasons aforesaid, both the orders impugned herein are set aside and the matter is remanded for re-consideration. After providing a reasonable opportunity to the petitioner, a fresh order shall be issued within three months from the date of receipt of a copy of this order.

6. These writ petitions are disposed of on the above terms. Consequently, connected writ miscellaneous petitions are closed. There shall be no order as to costs.