GST demand based on retrospective levy amendment set aside and remitted for reconsideration under binding precedent.

A demand for FY 2017-18 raised under Section 74 of the CGST Act, premised on the levy under Section 50 and the retrospective amendment in Section 112 of the Finance Act, 2021, was held unsustainable because the same factual matrix was already covered by an earlier decision of the Orissa HC. The departmental representative accepted that the earlier ruling applied, and the adjudication order was therefore set aside. The matter was remitted to the GST authority for reconsideration in accordance with that binding decision.

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Issues: Whether the demand raised for Financial Year 2017-18 under Section 74 of the Central Goods and Services Tax Act, 2017, based on the levy contemplated under Section 50 of that Act and the retrospective amendment carried out by Section 112 of the Finance Act, 2021, could be sustained.

Analysis: The demand was assailed on the footing that the basis of adjudication in the order-in-original rested on the levy under Section 50 of the Central Goods and Services Tax Act, 2017 for short-paid or unpaid GST for the period 2017-18. The impugned demand was tested against an earlier decision of the same Court in a similar matter, and the departmental representative fairly conceded that the impugned demand was untenable in view of that decision and that the same factual position applied.

Conclusion: The impugned order was set aside and the matter was remitted to the Superintendent of GST & Central Excise, Kendrapara Range for reconsideration in accordance with law, taking into account the earlier decision.

Final Conclusion: The writ petition succeeded to the extent of setting aside the adjudication order, but the controversy was sent back for fresh consideration by the statutory authority.

Ratio Decidendi: Where the impugned demand is conceded to be covered by an earlier binding decision on the same factual matrix, the adjudication order cannot be sustained and requires reconsideration in accordance with that ruling.

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