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of <h1>Tax Credit Appeal Allowed: Petitioner Granted Four-Week Window to Challenge Penalty Under Section 107 of CGST Act</h1> <h3>S. Mahendrakumar Devichand Versus The Union of India & Ors.</h3> S. Mahendrakumar Devichand Versus The Union of India & Ors. - 2024 (82) G.S.T.L. 51 (Bom.) Issues involved:The issues involved in the judgment are related to the demand of inadmissible input tax credit under Section 74 of the Central Goods and Services Tax Act, 2017 (CGST Act), imposition of penalties, dropping of demands, and the statutory remedy of appeal available to the petitioner.Demand of Inadmissible Input Tax Credit:The adjudicating officer passed an order dropping the demand against the petitioner for inadmissible input tax credit amounting to Rs. 20,63,46,994 under Section 74 of the CGST Act. The penalty under Section 74 was also dropped, but a penalty of the same amount was imposed under Section 122(1)(vii) of the CGST Act. The order directed the appropriation of the penalty amount from the total amount paid by the petitioner.Statutory Remedy of Appeal:Both counsels agreed that the petitioner has the statutory remedy of an appeal under Section 107 of the CGST Act to challenge the order-in-original. The petitioner intended to challenge the penalty imposed by the adjudicating officer. The High Court decided that further adjudication was not necessary, and the petitioner was permitted to file an appeal within four weeks from the date of the judgment.Order of the High Court:The High Court ordered that the respondents should not take any coercive action for four weeks based on the adjudicating officer's order. The respondents were directed to refund appropriate amounts to the petitioner after retaining 10% of the penalty amount for filing the statutory appeal. The refund was to be made within four weeks, and the petitioner was not required to make any further deposit. The High Court also allowed the petitioner to claim interest on the deposit of input tax credit in the appellate proceedings.Conclusion:The High Court disposed of the petition by allowing the petitioner to file an appeal against the order-in-original. The respondents were directed to refund the appropriate amounts to the petitioner, retaining a portion for the statutory appeal. The High Court kept all contentions of the parties on the appellate proceedings open and permitted the petitioner to claim interest on the deposit of input tax credit in the appeal. No costs were awarded in this matter.
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