Kesar Colour Chem Industries Vs Intelligence Officer (Karnataka High Court)
Karnataka High Court held that recovery made pending adjudication is contrary to law and accordingly contrary to Article 265 of the Constitution of India. Hence, amount recovered is liable to be refunded with interest.
Facts- The petitioner has called in question the correctness and legality of, Investigation carried out u/s. 67 of the Central Goods and Services Tax Act, 2017; the validity of the summons to the witness dated 31.07.2021; declaration that the recoveries to the tune of Rs.2.50 crores “extracted coercively” from the petitioner by the respondents on 31.07.2021 vide Payment Challan in Form GST PMT–06 Payment Challan; recovery at the office of respondent Nos.1 and 2 on 03.08.2021 while responding to the summons u/s. 70 of the CGST Act as abuse of power declaring that the recovery of Rs.2.50 crores u/s. 74(5) of CGST Act as being illegal; to quash the statements coercively taken by the respondents from the petitioner as being illegal; pending investigation direct that there should be no further recovery; direction to the respondents to furnish copies of the statements attributed to M/s Raj Chemicals; direction for investigation being carried out be transferred to Mumbai jurisdiction; and imposing of exemplary costs on respondent Nos.1 and 2 for causing mental agony.
