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Assessment order set aside after department transfers Rs. 63 lakh to state government, refund of pre-deposit ordered within eight weeks The Calcutta HC allowed an appeal challenging a writ petition dismissal regarding an assessment order's validity and input tax credit utilization. The ...
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Assessment order set aside after department transfers Rs. 63 lakh to state government, refund of pre-deposit ordered within eight weeks
The Calcutta HC allowed an appeal challenging a writ petition dismissal regarding an assessment order's validity and input tax credit utilization. The Department of Commercial Taxes, Government of West Bengal, transferred Rs. 63,71,353/- to the state government, rendering the challenged assessment order unsustainable. The HC set aside both the writ petition order and the impugned assessment order dated 21st August, 2023, directing the department to refund the 10% pre-deposit made by the appellant within eight weeks.
Issues involved: Challenge against assessment order u/s W.B.G.S.T. Act, specific contention not addressed in affidavit-in-opposition, appearance of State of Telangana, verification of input tax credit utilization, transfer of tax amount to State of West Bengal, refund of pre-deposit.
Challenge against assessment order: The appellant challenged an assessment order u/s W.B.G.S.T. Act which was dismissed as appealable. The impugned assessment order was stayed subject to a 10% tax deposit by the appellant. The Court directed the State to address specific contentions raised by the appellant regarding input tax credit utilization for payment of SGST and transfer to the State of West Bengal.
Specific contention not addressed: The appellant's claim of utilizing input tax credit for payment of SGST and subsequent transfer to the State of West Bengal was not specifically dealt with in the affidavit-in-opposition. The Court directed the State to obtain written instructions from the appropriate authority to address these allegations, emphasizing the importance of the State of Telangana's stand in the appeal.
Appearance of State of Telangana: Despite notice and service, the State of Telangana did not enter appearance. The Court granted liberty to serve all relevant documents to enable the State of Telangana to participate in the proceedings, highlighting the relevance of their stance for adjudication.
Verification of input tax credit utilization: The Deputy Commissioner provided written instructions upon verification of records, confirming the utilization and transfer of input tax credit amounts to the State of West Bengal. The Court noted the transfer of Rs. 63,71,353 to the State of West Bengal as per the provisions of the IGST Act.
Transfer of tax amount to State of West Bengal: The amount of Rs. 63,71,353, adjusted from SGST with IGST ITC, was transferred to the Government of West Bengal. Consequently, the assessment order under challenge was deemed unsustainable, leading to the allowance of the appeal and setting aside of the impugned assessment order.
Refund of pre-deposit: The Court directed the department to refund the 10% pre-deposit made by the appellant within eight weeks from the date of the order. No costs were imposed, and urgent certified copies of the order were to be provided to the parties upon completion of legal formalities.
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