GST UPDATE

Desk of CA. Praveen Sharma

Series- 437

Cancellation of GST Registration of supplier with retrospective effect cannot be a ground to deny ITC of purchaser where transactions are genuine and valid.

Good Judgement Save it

1- Calcutta HC in the case of Gargo Traders V/s The Joint Commissioner, Commercial Taxes (State Tax) & Ors.

2- The petitioner claimed credit of input tax against supply made from a supplier and it is alleged that the petitioner claimed to have purchased the goods are all fake and non-existing.

3- It is further alleged that the registration of the supplier has already been canceled with a retrospective effect covering the transaction period of the petitioner. The petitioner submitted a tax invoice cum challan, debit note, e-Way Bill, transportation bill, and statement of the bank account of Bank showing the transaction made by the petitioner in favor of the supplier. 

4- The court observed that at the time of the transaction, the name of the supplier as a registered taxable person was available with the Government record and the petitioner has paid the number of purchased articles as well as tax on the same through the bank and not in cash. Without proper verification, it cannot be said that there was any failure on the part of the petitioner in compliance of any obligation required under the statute before entering into the transactions in question.

5- The unreported judgment passed in the case of M/s Law Industries Limited & Ors. is squarely applicable in the present case.

Held that:- The Hon’ble High Court set aside the impugned orders and directed respondent no. 1 to consider the grievance of the petitioner afresh by taking into consideration the documents which the petitioner intends to rely on in support of his claim and shall dispose of the claim by passing a reasoned and speaking order after giving an opportunity of hearing to the petitioner within a period of eight weeks.

Case Cited Reference: LGW Industries Ltd. Versus Union of India (Calcutta), Balaji Exim Versus Commissioner, CGST (Delhi)

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CA. Praveen Sharma

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