Case Law Details

Case Name : In re Mallcom India Limited (Uttarakhand High Court)
Appeal Number : WPMS No.1206 of 2021
Date of Judgement/Order : 30/06/2021
Related Assessment Year :

In re Mallcom India Limited (Uttarakhand High Court)

Hon’ble Uttarakhand High Court issues notice to the GST Department coercive recovery regarding demand of ITC  due to misclassification of goods by the supplier  

Mallcom India Limited has filed a writ petition vide WPMS No. 1206 of 2021 before the Hon’ble Uttarakhand High Court seeking refund of tax coercively recovered by the GST Department without issue of show cause notice and without following the due process of law wherein the core issue in dispute is whether reversal of input tax credit can be demanded from the recipient because of misclassification of goods by the supplier by charging tax @ 28% instead of 18%.

It was submitted that whatever ITC was claimed by the petitioner is what was paid by the supplying unit and consequently there was no actual loss of revenue to the exchequer. It was argues that it is a revenue neutral situation. It was submitted that it has been held in plethora of cases that tax paid at the supplier end cannot be contested or challenged at the recipient end. It was further argued that the classification of a chapter heading cannot be determined at the recipient’s end. Accordingly, it was submitted that the demand of ITC from the petitioner due to misclassification by the supplier was bad in law.

Writ filed seeking refund of tax coercively recovered by GST Department

Moreover, it was argued that coercive recovery without issue of show cause notice is a violation of Sections 73 or 74 of the CGST and UGST Act and is also a violation of principles of natural justice. It was further submitted that unlawful recovery of taxes by the Government is violative of Article 265 of the Constitution of India. Further, it is also a violation of Article 19(1)(g) and Article 300A of the Constitution of India.

The Hon’ble Uttarakhand High Court vide its Order dated 30th June, 2021, issued notice to the respondents to file counter affidavit by four weeks and to file rejoinder affidavit thereto, if any, by two weeks thereafter. Further, it listed the matter for hearing after six weeks.

This matter was represented on behalf of the petitioners by Advocate Vinay Shraff and Advocate Piyush Garg. The respondents were represented by Advocate Shobhit Saharia.


Mr. Vinay Shraff, Advocate   for   the petitioners.

Mr. Shobhit Saharia, Advocate for the respondents.

Heard learned counsel for the parties through video conferencing.

Learned counsel for the respondents prays for and is granted four weeks’ time to file counter affidavit.

Rejoinder affidavit, if any, may be filed within two weeks thereafter.

List after six weeks.

Download Judgment/Order

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December 2023