Dr. Sanjiv Agarwal, FCA, FCS
Goods and Services Tax (GST), introduced from July 1, 2017 is almost ten months old now but has resulted in operational and implementation disruptions affecting all stakeholders. GST law, as drafted and legislated, is not free from the interpretational hassles. GST Council his however, making regular changes to fix the anomalies and hardships faced by taxpayers. There were no legislative changes in the Union Budget -2018.
Taxpayers have already started challenging various provisions of GST laws and rules framed there under with more than 100 writs being filed in different courts. High courts and Supreme court have taken a liberal stand so far in view of the fact that law is new and is yet evolving. However, CBIC may move to Supreme court where the verdict is against the Government. This has been indicated in Circular No. 39 dated 03.04.2018 wherein it is has been hinted in relation to resolution of struck TRAN-1 and filing of GSTR-3B that Government has not accepted blanket opportunity to file TRAN-1 but only in cases where technical glitches crept in. It has advised the departmental officers that courts may be suitably informed and if needed review or appeal may be filed.
Here are few more judicial pronouncements for information and guidance of various stakeholders. It is expected that the litigation is bound to go up as time passes by.
- In Nirmal Constructions v State of Madhya Pradesh (2017) 7 G.S.T.L. 3 (M.P.), where State Government cancelled tender proceedings which were initiated prior to introduction of GST, in view of change in tax environment on introduction of GST, it was held that since the person who had tendered was eligible for Input Tax Credit (ITC) on GST paid on goods/services, there was nothing wrong in decision to exclude amount of GST in tender value.
- In Coimbatore Road Contractors Welfare Association v. State of Tamil Nadu (2017) 7 GSTL 4 (Madras);  91 taxmann.com 318 (Madras), where the petitioner made several representations to the effect that works contract for which agreement were executed prior to implementation of GST Act,2017(i.e. w.e.f. 01.07.2017) 2 per cent VAT alone should be applicable. The Court directed the Commissioner of Commercial Taxes to consider the petitioner’s representations, such direction was given in view of the fact that petitioner ‘s representation was still pending when writ was filed and pass orders on merits and in accordance with law.
- In Aphro E-commerce Solutions (P.) Ltd. v. Union of India  91 taxmann.com 192 (Delhi), the petitioner was a web developer and IT software solution services provider in the international and domestic market and prior to the implementation of the Integrated Goods and Service Tax Act, 2017 (‘IGST Act’), there was no service tax on the export of services provided by the Petitioner. However, post the IGST Act, the export services provided by the Petitioner are covered under ‘zero rated supply’ under Section 16(1)(a) of the IGST Act, it was held that in order to avail of the input tax credit, the Petitioner, being a new entrepreneur with an export turnover of less than Rs.1 crore per annum, has to necessarily furnish a bond with a bank guarantee.
- In Rajeevan V.N. v. Central Tax Officer-1 Circle, Cochin  91 taxmann.com 195 (Kerala), where application preferred by petitioner for registration under the GST Act, 2017 had been rejected on ground of certain discrepancies in documents submitted by him along with application for registration, it was held that same ought to be considered by the authorities if fresh application with requisite documents are filed by the petitioner.
- In Willowood Chemicals (P.) Ltd.v.Union of India  91 taxmann.com 296 (Allahabad), the assessee filed writ petition challenging second proviso to sub-section (1) of section 140 of Gujarat GST Act, under which certain restrictions had been imposed on a dealer for taking tax credit of taxes already paid under erstwhile Gujarat VAT Act under the new GST regime, the court issued notice to Advocate General as the vires of the State Act were under challenge. The statue was also enacted retrospectively imposing unreasonable restriction.
- In Shunson CJ v. State Tax Officer  91 taxmann.com 411 (Kerala), where the assessee sought release of goods detained under section 129 of CGST Act, 2017 as also Kerala SGST Act, 2017, dealing with detention, seizure and release of goods and conveyance in transit, it was directed to Competent Authority to complete adjudication within a week of communication of order provided under section 129 of CGST Act, 2017 and further if assessee complied with Rule 140(1) of Kerala GST Act,2017, goods detained would be released to him forthwith.
- In J. Fabrics v. Kerala Authority for Advance Ruling Kerala State Goods & Service Tax  91 taxmann.com 402 (Kerala), where no action on part of revenue had been taken to decide Ext. P1 application preferred by assessee for seeking advance ruling, therefore, competent authority was directed to take a decision on said application after affording an opportunity of hearing.
(Some more cases to follow)
6 Recent Court Pronouncements On GST – Part I
8 Recent Court Pronouncements On GST – Part II
10 Recent Court Pronouncements on GST -Part III
8 Recent Pronouncements on GST (Part- IV)
6 Recent Pronouncements On GST (Part-V)
Recent Pronouncements on GST (Part-VI)
8 Recent Pronouncement on GST (Part-VII)