2024 (9) TMI 393 - HC - GST

Taxpayer's Input Tax Credit Challenge Rejected Due to Incomplete Vehicle Movement Documentation Under CGST Act

HC dismissed writ petition challenging tax authority's order blocking Input Tax Credit (ITC). Court held petitioner failed to provide mandatory vehicle ... Challenge to order and consequential attachment over the Credit Ledge balance of ITC being blocked - petitioner failed to produce the Vehicle movement details, such as Lorry receipt, TRIP sheet etc, which is mandatory, in terms of Section 16(2)(b) of the CGST Act - HELD THAT:- Upon perusal of the materials, it is clear that in terms of Section 16(2)(b) of the CGST Act, every tax payer, who intends to avail the benefit of Input Tax Credit (ITC), are supposed to furnish the particulars such as Vehicle movement details, Lorry Receipt and TRIP Sheet along with proper explanation. However, in the case on hand, since the petitioner failed to furnish those particulars, the impugned assessment order came to be passed by the respondent. As rightly pointed out by the learned Government Advocate, if at all the petitioner had any grievance over the impugned order, the petitioner has an alternate and efficacious remedy of filing an appeal before the Appellate Authority, however, instead of doing so, the petitioner has rushed before this Court challenging the same, by way of filing the present Writ Petition, which, this Court is not inclined to interfere with. Petition dismissed. Issues: Challenge to order dated 29.04.2024 passed by respondent regarding Credit Ledge balance of ITC.The petitioner challenged the order dated 29.04.2024 passed by the respondent, which involved the blocking of the Credit Ledge balance of Input Tax Credit (ITC) and sought to quash the same. The petitioner contended that the respondent's order was based on the petitioner's failure to produce certain mandatory vehicle movement details as required under Section 16(2)(b) of the CGST Act. The petitioner argued that the transaction in question was with a registered taxpayer and valid GST holder, but the supplier had subsequently canceled their GST registration with retrospective effect. The petitioner maintained that penalizing them for the supplier's default was unfair, especially since they had already paid the due tax to the supplier. The petitioner claimed that the impugned notice violated Article 14 of the Constitution of India and requested setting aside the order.The respondent, represented by the Government Advocate, justified the impugned order by emphasizing the requirement under Section 16(2)(b) of the CGST Act for taxpayers to provide specific details to avail ITC benefits. Since the petitioner failed to furnish the necessary particulars like vehicle movement details, lorry receipt, and TRIP sheet, the respondent issued the assessment order. The respondent suggested that the appropriate course of action for the petitioner, if aggrieved by the order, was to appeal to the Appellate Authority rather than filing a Writ Petition directly.After hearing both parties and examining the case materials, the court noted that the petitioner's failure to provide the required particulars led to the issuance of the impugned assessment order by the respondent. The court concurred with the Government Advocate's argument that the petitioner should have pursued the remedy of filing an appeal before the Appellate Authority instead of directly approaching the court through a Writ Petition. Consequently, the court dismissed the Writ Petition but granted the petitioner the liberty to challenge the order before the Appellate Authority within four weeks from the date of receiving the court's order. No costs were awarded, and connected Miscellaneous Petitions were closed.