Petitioner entitled to amnesty benefits despite late return; late fees and notice under Section 74 set aside for violating Article 14

The HC held that the petitioner, who filed the return belatedly before the cutoff date of the amnesty notification dated 31.03.2023, is entitled to its benefits despite the notification confining relief to returns filed between 01.04.2023 and 30.06.2023. The impugned order imposing late fees and the show cause notice under Section 74 were set aside for violating Article 14 and the principle of parity. The matter was remanded to the third respondent to pass a fresh order on merit, extending the benefit of the notification in accordance with law within three months. The petition was allowed by way of remand.

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Issues:
Challenge to Notification No. 07/2023 dated 31.03.2023 under Article 14 of the Indian Constitution and Principle of parity.
Entitlement of the petitioner to the benefit of the Notification No. 07/2023.
Validity of the show cause notice imposing late fee of Rs. 12,71,754.
Applicability of the amnesty scheme under Notification No. 7/2023 to the petitioner's case.
Denial of benefit to the petitioner due to filing the return before the issuance of the amnesty notification.
Interpretation of the intention of the government in issuing the notification.
Setting aside the impugned order and remanding the case for a fresh decision.

Analysis:
The petitioner filed a writ petition challenging Notification No. 07/2023 dated 31.03.2023, alleging violation of Article 14 of the Indian Constitution and the Principle of parity. The petitioner sought relief to declare the notification invalid and extend the benefit of concessional late fee to them. The petitioner, engaged in the business of manufacturing and sale of medicines, submitted their GSTR 9 return after the due date due to financial distress. The Central Board of Indirect Taxes and Customs issued the notification for waiver of late fee in excess of Rs. 20,000, but the petitioner was issued a show cause notice imposing a late fee of Rs. 12,71,754. The petitioner requested leniency based on the notification, but the benefit was denied by the respondent.

The court analyzed the provisions of Notification No. 07/2023 and considered the petitioner's case in light of a similar decision of the Kerala High Court. The court noted that the intention of the government was to encourage filing of returns within a stipulated period, and the benefit should extend to the petitioner who filed the return before the cut-off date mentioned in the notification. The court held that it would be unjust to deny the benefit to the petitioner merely because the return was filed before the issuance of the amnesty notification, which was limited to a specific period.

Consequently, the court set aside the impugned order and the show cause notice, remanding the case back to the respondent for a fresh decision. The court directed the respondent to pass a new order extending the benefit of the notification to the petitioner in accordance with the law expeditiously. The writ petition was allowed, and pending applications were disposed of with no costs awarded. The judgment emphasized the importance of interpreting government notifications to achieve the intended purpose of encouraging compliance and providing relief to taxpayers in distress.

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