2018 (2) TMI 766 - HC - GST

High Court emphasizes prompt issue resolution for access to Goods and Service Tax Network profiles.

The High Court addressed a company's petition regarding access issues to its online profile on the Goods and Service Tax Network, hindering the generation ... Access to electronic GST portal - facility for filing returns and generating E-way bills - grievance redressal mechanism - judicial reluctance to administer implementation of tax administrationAccess to electronic GST portal - facility for filing returns and generating E-way bills - Relief sought for operational access to the GST online profile to enable filing of returns, payment of tax and generation of E-way bills - HELD THAT: - The Court recorded the petitioner's grievance that, despite provisional and subsequently final registration, lack of full access to the online portal prevented filing of Return GSTR-3B, payment of tax, generation of E-way bills and claiming input tax credit. The Court declined to itself effectuate the operational access sought, holding that it is not the Court's function to grant such systemic access or to operate the electronic platform. The Court nevertheless directed the administrative authorities to work out and put in place the necessary mechanism to make the system operational and functional for affected taxpayers so that returns, payments and statutory compliances can be effected without paralysis of business; the Court emphasised that such administrative measures include restoring portal functionality and enabling taxpayers to comply with statutory obligations. [Paras 3, 4, 6, 8]Court refused to directly grant operational access but directed the authorities to put in place the requisite mechanism to enable filing of returns, payment of tax and generation of E-way bills.Grievance redressal mechanism - judicial reluctance to administer implementation of tax administration - Need for an administrative grievance redressal mechanism and the Court's supervisory stance in the absence of administrative action - HELD THAT: - The Court observed that the authorities must establish a grievance redressal mechanism to address widespread portal-related difficulties and that deferral to future meetings of the GST Council is not an adequate response to taxpayers' immediate inability to comply. The Court expressed expectation that those responsible for implementation will promptly remedy systemic defects to preserve the regime's credibility and avoid judicial intervention. The Court noted precedent before another High Court where the portal was directed to be reopened or manual applications entertained, and warned that it would be constrained to issue similar directions if administration failed to act. [Paras 8, 10, 11]Court directed respondents to establish an effective grievance redressal mechanism and warned that, absent administrative remediation, the Court may be obliged to issue orders similar to those made by another High Court.Procedural filing of affidavit - Procedural direction for respondent to file affidavit in reply - HELD THAT: - On the petitioner's plea and after hearing, the Court ordered respondent no.1 to file an affidavit in reply giving instructions and addressing the issues raised, with an advance copy to the petitioner's advocate. The matter was posted for further hearing on a specified date to enable the Court to consider the respondents' response. [Paras 9, 12]Respondent no.1 directed to file an affidavit in reply on or before 16th February 2018 and the matter posted for further hearing.Final Conclusion: The Court declined to itself operate or grant access to the GST portal but mandated that the administrative authorities promptly establish effective mechanisms (including grievance redressal and portal functionality) to enable filing of returns, payment of taxes and generation of E-way bills; respondent no.1 was ordered to file an affidavit in reply by 16th February 2018, failing which the Court indicated it may consider issuing further directions including relief comparable to that granted by another High Court. Issues:1. Access to online profile on Goods and Service Tax Network for a company engaged in manufacturing robotic and automation equipment.2. Inability to generate E-way bills due to lack of access to online profile.3. Inability to file necessary returns and pay taxes leading to interest liability and penal consequences.4. Difficulties faced by the petitioner in availing input tax credit mechanism.5. Lack of redressal mechanism for grievances related to Goods and Services Tax implementation.Analysis:1. The petitioner, a company manufacturing robotic and automation equipment, filed a petition in the High Court due to being unable to access its online profile on the Goods and Service Tax Network despite being granted provisional registration numbers under the Central Goods and Services Tax Act, 2017, and the Maharashtra Goods and Services Tax Act, 2017.2. The petitioner highlighted the importance of accessing the online profile to generate E-way bills, necessary for moving goods, filing returns, paying taxes, and complying with statutory requirements. The lack of access not only hampers business operations but also exposes the petitioner to interest liability and potential penal consequences.3. Despite being granted access to the online profile, the petitioner faced challenges in filing necessary returns, particularly Return GSTR-3B, as payment of late fees from October 2017 onwards was required. The petitioner also outlined numerous other difficulties in a further affidavit submitted to the court.4. The court emphasized that it was not within its jurisdiction to directly address the petitioner's access issues and operational functionality concerns related to the Goods and Services Tax system. It urged the authorities to establish necessary mechanisms and grievance redressal systems to resolve such issues promptly.5. Expressing dissatisfaction with the current state of affairs, the court highlighted the need for a tax-friendly environment under the Goods and Services Tax regime to ensure easy access to websites and portals for taxpayers. It stressed the importance of preserving the country's image and attracting foreign investments by improving the implementation and administration of tax laws.6. The court referenced a similar case before the Allahabad High Court and indicated a potential direction to address the petitioner's grievances if necessary. The matter was adjourned to allow respondent no.1 to file an affidavit in reply by a specified date, with a copy provided to the petitioner's advocate.This detailed analysis of the judgment provides a comprehensive overview of the issues raised by the petitioner and the court's response, emphasizing the importance of efficient implementation and administration of tax laws to facilitate ease of compliance for taxpayers.