Karnataka High Court
M/S Sri Venkateshwara Earth Movers vs Assistant Commissioner Of Commercial ... on 3 September, 2024
Author: S.R.Krishna Kumar
Bench: S.R.Krishna Kumar
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NC: 2024:KHC:36911
WP No. 21178 of 2023
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 3RD DAY OF SEPTEMBER, 2024
BEFORE
THE HON'BLE MR JUSTICE S.R.KRISHNA KUMAR
WRIT PETITION NO. 21178 OF 2023 (T-RES)
BETWEEN:
M/S SRI VENKATESHWARA EARTH MOVERS
REPRESENTED BY ITS PROPRIETOR,
MR BALAJI NAICK,
AGED ABOUT 47 YEARS,
NO.3, 8TH MAIN, 3RD CROSS,HBR LAYOUT,
3RD BLOCK, 2ND STAGE,
KALYANA NAGAR POST,
BENGALURU-560 043.
...PETITIONER
(BY SRI. SHANKARE GOWDA M N.,ADVOCATE)
AND:
1. ASSISTANT COMMISSIONER OF COMMERCIAL TAXES
LGSTO-055, HBR LAYOUT, BDA COMPLEX,
KALYAN NAGAR, BENGALURU-560 043.
2. THE STATE OF KARNATAKA
DEPARTMENT OF FINANCE,
REPRESENTED BY ITS SECRETARY,
VIDHANA SOUDHA, BENGALURU-560 001.
Digitally signed
by LEELAVATHI
SR 3. GOVERNMENT OF INDIA
MINISTRY OF FINANCE
Location: HIGH
COURT OF (DEPARTMENT OF REVENUE)
KARNATAKA RAJPATH MARG, E BLOCK,
CENTRAL SECRETARIAT, NEW DELHI
DELHI-110 011.
4. THE COMMISSIONER OF COMMERCIAL TAXES
VANIJYA THERIGE KARYALAYA
VTK-1, KALIDASA ROAD,
GANDHINAGAR, BENGALURU-560 009.
...RESPONDENTS
(BY SRI.HEMA KUMAR K., AGA FOR R1, R2, R4;
SRI. POOJAPPA J.,ADVOCATE FOR R3)
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NC: 2024:KHC:36911
WP No. 21178 of 2023
THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF
THE CONSTITUTION OF INDIA, PRAYING TO STRUCK DOWN SECTION
16(4) OF CGST/SGST ACT, 2017 AS VIOLATIVE OF ARTICLE OF 14, 19
AND 300A OF THE CONSTITUTION OF INDIA READ DOWN THE SAID
WORDINGS CONTAINED IN SECTION 16(4) OF CGST/SGST ACTS, 2017
SO AS TO INTERPRET THE TIME LIMIT FOR TAKING INPUT TAX CREDIT
AS PROCEDURAL AND DIRECTORY IN NATURE AND DECLARE
REJECTION OF FILING OF MONTHLY RETURNS BELATEDLY IN GSTR-3B,
AS NULL AND VOID AND ULTRA-VIRES THE CONSTITUTION OF INDIA
AND VIOLATIVE OF ARTICLES 14 AND 19 AND ETC.,
THIS WRIT PETITION, COMING ON FOR ORDERS THIS DAY,
ORDER WAS MADE THEREIN AS UNDER:
CORAM: HON'BLE MR JUSTICE S.R.KRISHNA KUMAR
ORAL ORDER
In this petition, petitioner seeks for the following reliefs:-
i) The Petitioner most respectfully prays that this Hon'ble High Court may be pleased to struck down Section 16(4) of CGST/SGST Act, 2017 as violative of Article of 14, 19 and 300A of the Constitution of India.
ii) The Petitioner most respectfully prays that this Hon'ble High Court may be pleased to read down the said wordings contained in Section 16(4) of CGST/SGST Acts, 2017 so as to interpret the time limit for taking input tax credit as procedural and directory in nature.
iii) The Petitioner most respectfully prays that this Hon'ble High Court may be pleased to declare rejection of filing of monthly returns belatedly in GSTR-3B, as null and void and ultra-vires the Constitution of India and violative of Articles 14 and 19.-3-
NC: 2024:KHC:36911 WP No. 21178 of 2023
iv) The Petitioner most respectfully prays that this Hon'ble High Court may be pleased to struck down Rule 61(5) of CGST/SGST Rules, 2017 which is retrospective from 01.07.2017 has been unreasonable, arbitrary and discriminatory as violative of Articles 14 and 19 of the Constitution of India.
v) The Petitioner most respectfully prays that this Hon'ble High Court may be pleased to struck down Section 164(3) of the CGST/SGST Acts, 2017 as violative of Articles 14 and 19 being unreasonable and discrimination.
vi) The Petitioner most respectfully prays that this Hon'ble High Court may be pleased to issue a Writ of Certiorari or a direction in the nature of a Writ of Certiorari quashing the impugned orders dated 14.07.2023 and 12.07.2023 in NO.ACCT/LGSTO-55/T.NO.2550/2023-24 and T.No.2544/23-24 (Annexures-A and B) passed u/s 73(9) issued by the 1st Respondent under KGST/CGST Acts, directing the 1st Respondent to accept the monthly returns filed in Form GSTR-3B for the periods 2017-18 and 2019- 20 in the Petitioner's case.
vii) This Hon'ble High Court may be pleased to issue such other writ or writs or directions in the nature of a writ as this Hon'ble High Court may deem it fit to grant in the facts and circumstances of the Petitioner's case."
2. Heard learned counsel for the petitioner and learned counsel for the revenue and learned AGA for the State and perused the material on record.
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3. A perusal of the material on record will indicate that the issue in controversy involved in the present petition is directly and squarely covered by the judgment of this Court in the case of M/s.Sadhana Enviro Engineering Services vs. Joint Commissioner of Central Tax & others - W.P.No.6138/2020 dated 03.09.2024, which reads as under:-
2. Heard learned Senior counsel for the petitioner and learned counsel for the respondents - revenue and learned AGA for the State and perused the material on record.
3. Learned Senior counsel for the petitioner submitted that though several contentions have been urged by the petitioner who has also sought for various reliefs, during the pendency of the present petition, a new provision i.e., Section 16(5) has been inserted by "The Finance (No.2) Act, 2024" vide Central Act 15 of 2024, in which, Clause No.118 provides for condonation of delay in availment of credit and extended the time limit by providing that for supplies pertaining to the financial years 2017-18, 2018-19, 2019-20 and 2020-21, the petitioner would be entitled to avail / claim credit in any return filed up to 30.11.2021. It is submitted that the said "The Finance (No.2) Act, 2024" received presidential asset on 16.08.2024 and would be notified shortly. It was further submitted that in cases where assessees had paid amounts as pre-deposit under court orders or in appeal -5- NC: 2024:KHC:36911 WP No. 21178 of 2023 proceedings or amounts recovered by the respondents -
revenue are paid by the assessees pursuant to recovery proceedings, the embargo contained in Clause 150 of the said "The Finance (No.2) Act, 2024" would not apply and was not applicable to the assessees, who would not be covered by the said embargo and consequently, they would be entitled to refund of the said amounts. It is therefore submitted that without going into the various other contentions urged by the petitioner and reliefs sought for by it and without expressing any opinion on the same, the present petition may be disposed of with a direction to consider and implement and give effect to the amended provisions contained in Section 118 of "The Finance (No.2) Act, 2024" relating to insertion of Section 16(5) to the CGST Act / KGST Act within a stipulated time frame.
4. Per contra, learned counsel for the respondents
- revenue and learned AGA for the respondents - State jointly and fairly submit that it is true that Section 16(5) was inserted vide Clause 118 of "The Finance (No.2) Act, 2024"
and that the same was applicable to the petitioner and other assessees and the time for filing returns and availing input tax credit would stand extended upto 30.11.2021. It is also submitted that since presidential asset has already been received to "The Finance (No.2) Act, 2024", necessary Notification would be issued shortly and as such, the present petition may be disposed of accordingly.
5. As rightly contended by the learned Senior counsel for the petitioner as well as learned counsel for the -6- NC: 2024:KHC:36911 WP No. 21178 of 2023 respondents - revenue and learned AGA for the State, Section 16(5) was inserted into the CGST Act vide Clause 118 of the "The Finance (No.2) Act, 2024", which reads as under:-
"118. In Section 16 of the Central Goods and Services Act, with effect from the 1st day of July, 2017, after sub-section(4), the following sub-sections shall be inserted, namely:-
(5) Notwithstanding anything contained in sub-
section(4), in respect of an Invoice or Debit note for supply of goods or services or both pertaining to the financial years, 2017-18, 2018-19, 2019-20 and 2020-21, the registered person shall be entitled to take input tax credit in any return under Section 39 which is filed up to the thirtieth day of November, 2021.
(6) xxxxxxxxxxxxx
(i) xxxxxxxxxxxxxx
(ii)xxxxxxxxxxxxxx "
6. In view of the aforesaid amendment by inserting Section 16(5) to the CGST / KGST Act, the present petition deserves to be disposed of relegating the parties to the original authority to implement and give effect to the said provisions after providing sufficient and reasonable opportunity to the petitioner and hearing them and proceed further in accordance with law and by issuing certain directions in this regard.
7. In the result, I pass the following:-
ORDER
(i) Petition is hereby disposed of.-7-
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(ii) The parties are relegated to the stage of show cause notice at Annexure-C dated 13.02.2020 issued by the respondent(s) and the respondents are directed to give effect to and implement the amended provisions contained in Section 118 of "The Finance (No.2) Act, 2024" relating to insertion of Section 16(5) to the CGST Act / KGST Act by providing sufficient and reasonable opportunity and hear the petitioner and proceed further in accordance with law within a period of one month from the date of receipt of a copy of this order.
(iii) The impugned blocking of the Input Tax Credit (ITC) ledger of the petitioner vide Annexure-F dated 03.02.2020 is hereby quashed.
(iv) The respondents are directed to unblock and release the credit balance of the petitioner in their ITC Ledger / Account, if not already released, immediately / forthwith upon receipt of a copy of this order without any delay.
(v) All rival contentions on all other prayers sought for by the petitioner including the challenge to the statutory provisions are kept open and no opinion is expressed on the same.
4. In view of the aforesaid facts and circumstances and the judgment of this Court in M/s.Sadhana Enviro Engineering's case supra, I am of the view that the present petition also deserves to be allowed and disposed of in terms of the said judgment.
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5. In the result, I pass the following:-
ORDER
(i) Petition is hereby disposed of in terms of the judgment of this Court in the case of M/s.Sadhana Enviro Engineering Services vs. Joint Commissioner of Central Tax & others -
W.P.No.6138/2020 dated 03.09.2024.
(ii) The impugned Order at Annexures-A and B dated 14.07.2023 and 12.07.2023 are hereby quashed.
(iii) The parties are relegated to the stage of show cause notices dated 31.11.2022 and 07.06.2023 issued by the respondent(s) and the respondents are directed to give effect to and implement the amended provisions contained in Section 118 of "The Finance (No.2) Act, 2024" relating to insertion of Section 16(5) to the CGST Act / KGST Act by providing sufficient and reasonable opportunity and hear the petitioner and proceed further in accordance with law within a period of one month from the date of receipt of a copy of this order.
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(iv) All rival contentions on all other prayers sought for by the petitioner including the challenge to the statutory provisions are kept open and no opinion is expressed on the same.
Sd/-
(S.R.KRISHNA KUMAR) JUDGE Srl/Mds