Court dismisses Writ Petition for tax refund; orders investigation completion & show cause notice issuance

The court found no merit in the Writ Petition seeking Mandamus for refund of amounts paid under coercion regarding an Input Tax Credit investigation. The court determined the amounts were paid "under protest" and directed the respondent to complete the investigation, issue a show cause notice within six months, and return any seized documents to the petitioner. The respondent was instructed to outline reasons and details clearly in the notice and complete the process within twelve months. If no case was established, the respondent must refund the amount to the petitioner as per the law. The court disposed of the Writ Petition without costs.

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Issues:
Petitioner seeking Mandamus for refund of paid amounts under coercion regarding Input Tax Credit investigation.

Analysis:
The petitioner filed a Writ Petition requesting a Mandamus to direct the respondent to refund the amounts of Rs. 17,27,790 and Rs. 12,60,472 paid during an investigation into alleged wrong availment of Input Tax Credit. The petitioner claimed the amounts were paid under coercion. The respondent, through the Senior Standing Counsel, argued that the Writ Petition lacked merit as the petitioner admitted to the wrong availment of Input Tax Credit. The court considered both sides' arguments.

The court noted that the amounts paid by the petitioner were considered as deposits pending adjudication under Sections 73/74 of the CGST Act, 2017. These amounts were collected during a visit where summons were issued, Mahazar was drawn, and seizure memo was issued to the petitioner. The petitioner also submitted a representation. The court found no merit in the Writ Petition at this stage and deemed the amounts paid by the petitioner as paid "under protest." The court directed the respondent to complete the investigation, issue a show cause notice within six months, and return any seized documents to the petitioner.

Furthermore, the court instructed the respondent to clearly outline the reasons and details of the Relied Upon Documents in the show cause notice. The respondent was required to complete the entire process, including issuing the notice and receiving the petitioner's reply, within twelve months. If no case was established during the proceedings, the respondent was obligated to refund the amount to the petitioner as per the law. The court disposed of the Writ Petition with these directives and closed the connected miscellaneous petition without imposing any costs.

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