2021 (11) TMI 1102 - HC - GST

Court denies interim relief in challenge to GST officers' summons jurisdiction under CGST Act, emphasizes cooperation in investigations.

Suumaya Corporation Ltd. and Anr. Versus Union of India and Ors.

The court declined to grant ad-interim relief against arrest in a case challenging the jurisdiction of GST officers to issue summons under the CGST Act. ... Seeking grant of bail - evasion of GST - issuance of fake invoices without actual supply and receipt of goods - scope and ambit of Section 132 read with Section 69 of the Central Goods and Service Tax Act, 2017 - HELD THAT:- In the facts and circumstances of the case, it is opined that the Petitioner No.2 is not co-operating in the investigation and was required to be issued summons eight times. Even otherwise, assuming such blanket direction can be issued, it ought to be issued in rarest of rare cases and is not at all warranted in the facts of the present case. The issue of constitutionality of sections 69 and 132 of the CGST Act is now pending before the Apex Court. Leaving the remedies of Petitioner No.2 to seek reliefs before the appropriate forum open, the prayer for grant of ad-interim relief is rejected. List the Petition on 8th December, 2021. Issues:1. Jurisdiction of GST officers to issue summons under CGST Act.2. Constitutionality of sections 69 and 132 of the CGST Act.3. Ad-interim relief against arrest for non-cooperation in investigation.Analysis:Issue 1: Jurisdiction of GST officers to issue summons under CGST ActThe petitioners sought relief challenging the summons issued under section 70 of the CGST Act by Respondent No.5. They argued that the goods in question were not leviable to GST and that the power to arrest without prior notice or determination of tax evaded violated their rights under Article 14 and 21 of the Constitution. The ASG contended that the summons were part of a civil inquiry against M/s. SRK Ventures for GST evasion amounting to Rs. 48.17 crores. The court noted that Petitioner No.2 failed to appear despite multiple summons and refused to grant ad-interim relief against arrest, emphasizing the importance of cooperation in investigations.Issue 2: Constitutionality of sections 69 and 132 of the CGST ActThe petitioners argued that the unfettered discretion of GST officers to arrest without prior notice violated their constitutional rights. They urged the court to read the power to make laws under Article 246-A as civil in nature. However, the court declined to grant ad-interim relief, citing the pending issue of constitutionality before the Apex Court. The court emphasized that such relief should be granted only in rare cases and rejected the prayer in the present matter.Issue 3: Ad-interim relief against arrest for non-cooperation in investigationThe court considered the non-cooperation of Petitioner No.2 in the investigation, as evidenced by multiple summons being ignored. Despite the petitioners' request for relief against arrest, the court found no grounds for granting ad-interim relief, emphasizing the importance of cooperation in legal proceedings. The court directed the respondents to file an Affidavit-in-Reply to the Writ Petition and scheduled the next hearing for December 8, 2021.In conclusion, the court refused to grant ad-interim relief against arrest, highlighting the necessity of cooperation in investigations and the pending issue of constitutionality before the Apex Court. The court emphasized the importance of following legal procedures and directed the respondents to respond to the Writ Petition, maintaining the matter for further hearing.