GST collection remitted through another registration does not trigger Section 76 when the full amount reached the Government.

Writ intervention was considered appropriate against a show cause notice where the prior departmental inquiry and the notice recitals had already fixed the factual controversy, leaving no real issue for fresh adjudication. On the GST merits, Section 76 of the CGST Act was held inapplicable because the amount collected as GST was fully remitted to the Government, even though payment was made through another registration. As the statutory condition of collection without payment was absent, the demand and penalty proceedings could not be sustained, and the notice was quashed.

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Issues: (i) Whether the writ petition was maintainable at the stage of the impugned show cause notice when the notice, read with the prior inquiry and its own recitals, had effectively concluded the controversy; (ii) Whether the ingredients of Section 76 of the Central Goods and Services Tax Act, 2017 were satisfied where the GST component collected by one registration was admittedly remitted through another registration and the amount collected tallied with the amount paid to the Government.

Issue (i): Whether the writ petition was maintainable at the stage of the impugned show cause notice when the notice, read with the prior inquiry and its own recitals, had effectively concluded the controversy.

Analysis: The proceedings had remained pending for years and were preceded by a detailed inquiry in which the Department had already examined the transaction structure, documents, and accounts. The notice itself recorded the relevant factual position and quantified the proposed demand without leaving any real factual issue for further adjudication. In these special facts, relegating the petitioner to reply afresh was unnecessary, and the Court treated the matter as fit for writ intervention on the question of law arising from the notice.

Conclusion: The writ petition was maintainable and interference with the show cause notice was warranted.

Issue (ii): Whether the ingredients of Section 76 of the Central Goods and Services Tax Act, 2017 were satisfied where the GST component collected by one registration was admittedly remitted through another registration and the amount collected tallied with the amount paid to the Government.

Analysis: Section 76 applies only where a person collects an amount as representing tax and does not pay it to the Government. The Court held that the petitioner was a person under the Act, but the existence of multiple registrations did not alter the factual position that the amount collected as GST on transmission charges was fully remitted, though through another registration. The notice itself and the prior departmental finding recorded that the tax paid by the transmission registration matched the amount collected from customers as reimbursement of GST cost, and there was no evidence of any retained tax amount. On these facts, the statutory condition of collection without payment was absent, and Section 76 could not be used to sustain the demand or penalty proceedings.

Conclusion: Section 76 was not attracted, and the show cause notice was unsustainable.

Final Conclusion: The impugned show cause notice was quashed, and the petitioner obtained complete relief in the writ petition.

Ratio Decidendi: Section 76 of the CGST Act, 2017 can be invoked only when the very amount collected as tax remains unpaid to the Government; where the recorded facts show full remittance of the collected GST component, including through another registration, the statutory precondition fails and the notice is liable to be set aside.

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