2020 (8) TMI 285 - HC - GST

Dismissal of GST Compensation Cess refund petition; petitioner opts for arbitration over court dispute resolution.

The court dismissed the writ petition seeking to quash a letter charging GST (Compensation Cess) and demanding a refund, as the petitioner withdrew the ... Permission for withdrawal of petition - refund of GST (Compensation cess) - HELD THAT:- The petition is dismissed as wiythdrawn. Issues:1. Quashing and setting aside a letter charging GST (Compensation Cess)2. Direction for refund of amount charged as GST3. Restraining respondent from raising GST (Compensation Cess)4. Declaration that Washery Rejects are not under GST ambitAnalysis:1. The petitioner sought to quash a letter charging GST (Compensation Cess) and Washery Rejects cost. The petitioner argued that the liability of cess payment is on the taxable person making a taxable supply, which, in this case, was the respondent CCL. The petitioner claimed the charge was illegal and arbitrary under the Goods and Service Tax (Compensation to States) Act, 2017. The relief sought was to set aside the letter and bill issued by the Project Officer.2. Additionally, the petitioner requested a direction for an immediate refund of the amount charged as GST (Compensation Cess) along with statutory interest. The petitioner aimed to recover an amount of Rs. 54,85,564.00 raised in the bill dated 16.08.2017. The petitioner argued that the respondent CCL should refund this amount as they are the taxable person supplying Washery Rejects.3. The petitioner sought to restrain the respondent CCL from raising, realizing, and recovering GST (Compensation Cess) except for the fixed cost of Washery Rejects. The petitioner argued that the liability to make payment of cess under the Act was solely on the respondents, and they should not charge GST in bills raised for supplying Washery Rejects.4. Lastly, the petitioner requested a declaration that Washery Rejects are waste products and do not fall under the GST ambit, specifically Chapter 27 of the Goods and Service Tax (Compensation to States) Act, 2017. This declaration aimed to establish that Washery Rejects should not be subject to GST (Compensation Cess) as they are not classified under the Act.In response, counter affidavits were filed by the CCL and the CGST, with the petitioner providing a reply. The petitioner, seeking to raise the dispute in arbitration as per the agreement, withdrew the writ petition. The CCL argued that the writ petition was not maintainable based on statements in the counter affidavit. The CGST did not object to the withdrawal of the writ petition. Consequently, the court dismissed the writ petition as withdrawn, leaving the petitioner the option to pursue other remedies, including arbitration, if legally permissible.