Case Law Details
Arihant Steel Vs State Of U.P. And 2 Others (Allahabad High Court)
In the case of Arihant Steel vs. State of U.P. and others, the Allahabad High Court reviewed a writ petition challenging the orders passed by the Assistant Commissioner and Additional Commissioner of State Goods & Service Tax, which had rejected the petitioner’s Input Tax Credit (ITC) claims. The petitioner argued that the rejection was unjust as it lacked proper notice and reasoning. Specifically, the notice did not include hearing dates or reasons for the rejection, and new facts used against the petitioner in the appeal were not previously disclosed. The Court agreed, noting that the petitioner was denied an opportunity to present their case effectively. Consequently, the Court quashed the impugned orders and remanded the matter for a fresh, reasoned decision by the authorities, ensuring proper hearing and consideration of all relevant facts.
FULL TEXT OF THE JUDGMENT/ORDER OF ALLAHABAD HIGH COURT
1. Heard Sri Parth Goswami, Advocate holding brief Sri Pranjal Shukla, learned counsel for the petitioner and learned Standing Counsel for the State-respondents.
2. By means of instant writ petition, the petitioner has assailed the order dated 24.09.20 19 passed by Assistant Commissioner, Sector-8, State Goods & Service Tax, Bareilly as well as the impugned order dated 07.07.2022 passed by the Additional Commissioner, Grade-2 (Appeal) 1st, State Goods & Service Tax, Bareilly.
3. Learned counsel for the petitioner submits that the petitioner, being a registered dealer, in normal course of business, purchased the goods from authorized dealer through tax invoice and paid the due tax thereof. The goods were transported to M/s Awadh Transporter, Nanpara, bill has already been filed to which payment was made through banking channel. Thereafter, the petitioner claimed the Input Tax Credit, which has wrongly been rejected without issuing proper notice or reasoned order, which has been confirmed by the appellate court. He submits that in the notice dated 14.08.2019, neither the place of venue nor date of hearing was given and therefore the impugned order has illegally been passed, rejecting the claim under Section 73 of the SGST Act, as no reason has been assigned therein for rejection and only refers the ITC claim rejected, against which an appeal was preferred, which has also been dismissed without considering the material available on record.
4. He further submits that since the petitioner was neither given any opportunity of hearing nor to lead his case as no date was fixed for personal hearing in the notice nor any reason in the notice or in the order has been assigned for rejecting the claim of the petitioner. Further, the appeal has also been rejected on the facts, which was brought for the first time in the appeal and therefore, the material, which has been used against the petitioner for the first time in the appeal, cannot be used without giving due opportunity to rebut the same.
5. Per contra, learned Standing Counsel supports the impugned orders by submitting that since the petitioner has wrongly availed the ITC, therefore, the same has rightly been rejected.
6. After hearing the parties, the Court has perused the record.
7. In the notice issued to the petitioner, neither the date for personal hearing was fixed nor any reason has been assigned for initiating the proceedings under Section 73 of the SGST Act, and the impugned order has been passed by the assessing authority i.e. respondent no.3 without assigning any reason. Further, in the appeal, new facts were brought to which the petitioner was never put to notice, learned Standing Counsel could not dispute the said fact that for the first time, the new facts have been mentioned in the impugned order to which the petitioner has not been given any opportunity to rebut the same.
8. In view of the categorical statements made by the learned Standing Counsel as well as material available on record, impugned orders cannot sustain in the eyes of law and the same are hereby quashed.
9. Accordingly, the writ petition is allowed. The matter is remanded to the respondent no.3 to pass a fresh reasoned and speaking order, without being influenced from any observation made here-in-above, within a period of two months from the date of production of certified copy of this order, after hearing all the stakeholders.
10. Any amount deposited by the petitioner pursuant to the impugned orders, shall be subject to the outcome of the fresh order to be passed by the respondent no.3.