TaxTMI 
TaxTMI 
2025 (6) TMI 98
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....imed and for input tax credit, credit was availed. 3. A show-cause notice dated 06.09.2021 was issued for financial year 2017-18 by Assistant Commissioner, State Tax, Block-3, Jhansi under Section 74(1) of the Act of 2017. A reply was submitted on 05.10.2021, thereafter, an order under Section 74(9) was passed demanding tax/interest and penalty on 17.12.2021. The order was subjected to appeal by petitioner before Additional Commissioner, Grade-II (Appeal) IInd, Commercial Tax, Jhansi who dismissed the same on 20.12.2022. Hence, this writ petition. 4. Ms. Pooja Talwar, counsel for petitioner submitted that when the transaction had taken place and the goods were purchased from the supplier firm Shree Radhey International, which was a registered firm under the Act, all the payments were made through RTGS and filter paper so purchased was brought in the car of petitioner itself and no help of outside transportation was taken up. The registration of Shree Radhey International was cancelled on 11.09.2019 while the transaction had taken place between March and April, 2018. According to her, necessary documents for claiming ITC were provided pursuant to which the benefit was accorded....
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....then only ITC can be availed. According to him, the petitioner could not place any prove before the authorities pursuant to issuance of notice under Section 74 that transaction was bona fide and tax invoice along with transportation of goods and tax deposited by supplier firm was placed. According to him, Assessing Authority had rightly repelled the contention of petitioner and ordered for payment of taxes along with interest and penalty. Reliance has been placed upon the decision of Apex Court rendered in case of The State of Karnataka vs. M/s Ecom Gill Coffee Trading Private Limited, Civil Appeal No. 230 of 2023, decided on 13.03.2023 as well as decision of co-ordinate Bench rendered in M/s Shiv Trading vs. State of U.P. and 2 others, Writ Tax No. 1421 of 2022, decided on 28.11.2023. 8. I have heard respective counsel for the parties and perused the material on record. 9. The short point for consideration is as to whether the petitioner is entitled for input tax credit for alleged transaction having been taken place between the supplier, Shree Radhey International, Delhi and petitioner in the year 2018. 10. Before delving into question of eligibility, condition and avail....
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....rnished the return under section 39: PROVIDED that where the goods against an invoice are received in lots or instalments, the registered person shall be entitled to take credit upon receipt of the last lot or instalment: PROVIDED FURTHER that where a recipient fails to pay to the supplier of goods or services or both, other than the supplies on which tax is payable on reverse charge basis, the amount towards the value of supply along with tax payable thereon within a period of one hundred and eighty days from the date of issue of invoice by the supplier, an amount equal to the input tax credit availed by the recipient shall be [paid by him along with interest payable under section 50], in such manner as may be prescribed:: PROVIDED ALSO that the recipient shall be entitled to avail of the credit of input tax on payment made by him 7[to the supplier] of the amount towards the value of supply of goods or services or both along with tax payable thereon. (3) ******** (4) ******* 41. Claim of input tax credit and provisional acceptance thereof (1) Every registered person shall, subject to such conditions and restrictions as....
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....the amount of credit reversed by him in such manner as may be prescribed.] "43A. Procedure for furnishing return and availing input tax credit (1) Notwithstanding anything contained in sub-section (2) of section 16, section 37 or section 38, every registered person shall in the returns furnished under sub-section (1) of section 39 verify, validate, modify or delete the details of supplies furnished by the suppliers. (2) Notwithstanding anything contained in section 41, section 42 or section 43, the procedure for availing of input tax credit by the recipient and verification thereof shall be such as may be prescribed. (3) The procedure for furnishing the details of outward supplies by the supplier on the common portal, for the purposes of availing input tax credit by the recipient shall be such as may be prescribed. (4) The procedure for availing input tax credit in respect of outward supplies not furnished under sub-section (3) shall be such as may be prescribed and such procedure may include the maximum amount of the input tax credit which can be so availed, not exceeding twenty per cent. of the input tax credit available, on the basis ....
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....clearly lays down that subject to provisions of Section 41 or 43A (which was prior to amendment), the tax charged in respect of such supply has been actually paid to the Government by the supplier. This condition clearly restricts the power to take the benefit of input tax credit subject to deposit by supplier. 17. The scheme of Section 16 has to be read in consonance with Section 41 of the Act of 2017 which prior to amendment provided for claim of input tax credit and provisional acceptance thereof. It provided that subject to condition and restriction as may be prescribed every registered person was entitled to take credit of eligible input tax, meaning thereby that availment of input tax credit was subject to conditions and restrictions which were provided under Section 16. 18. Prior to Finance Act of 2022 whereby Section 43A was omitted provided for procedure for furnishing return and availing input tax credit. It also starts with a non obstante clause and provides that every registered person shall in the return furnished under sub-section (1) of section 39 verify, validate, modify or delete the details of supplies furnished by the supplier. Thus, the very requirement fo....
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....ing dealer claiming such ITC. Burden of proof that the ITC claim is correct is squarely upon the assessee who has to discharge the said burden. Merely because the dealer claiming such ITC claims that he is a bona fide purchaser is not enough and sufficient. The burden of proving the correctness of ITC remains upon the dealer claiming such ITC. Such a burden of proof cannot get shifted on the revenue. Mere production of the invoices or the payment made by cheques is not enough and cannot be said to be discharging the burden of proof cast under section 70 of the KVAT Act, 2003. The dealer claiming ITC has to prove beyond doubt the actual transaction which can be proved by furnishing the name and address of the selling dealer, details of the vehicle which has delivered the goods, payment of freight charges, acknowledgement of taking delivery of goods, tax invoices and payment particulars etc. The aforesaid information would be in addition to tax invoices, particulars of payment etc. In fact, if a dealer claims Input Tax Credit on purchases, such dealer/purchaser shall have to prove and establish the actual physical movement of goods, genuineness of transactions by furnishing the detai....
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....y been initiated. 20. Further, the case law relied upon by the counsel for the petitioner of this Court in Ashish Trading Company (supra) is also of no aid to the petitioner as in that case in para 14, the Court has recorded a finding of fact that order of the first appellate authority is cryptic as no details were provided. But the facts of the present case is different as stated in previous paras and recent judgement of Apex Court in the case of Ecom Gill Coffee Tradiving Pvt. Ltd. (supra) is squarely applicable in the facts of the present case. 21. In view of the facts as stated above, no interference is called for by this Court in the impugned orders. The writ petition fails and is dismissed accordingly. 12. From the perusal of the record shows that the petitioner failed to discharge its onus to prove and establish beyond doubt the actual transaction, actual physical movement of goods as well as the genuineness of the transactions and as such, the proceedings have rightly been initiated against the petitioner under section 74 of the GST Act." 24. Hon'ble Apex Court in M/s Ecom Gill Coffee Trading Private Limited (supra) while dealing with provision....
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....aining to the period upto Financial Year 2023-24,] not paid or short paid or erroneously refunded or input tax credit wrongly availed or utilised by reason of fraud or any wilful-misstatement or suppression of facts. (1) Where it appears to the proper officer that any tax has not been paid or short paid or erroneously refunded or where input tax credit has been wrongly availed or utilised by reason of fraud, or any wilful-mis statement or suppression of facts to evade tax, he shall serve notice on the person chargeable with tax which has not been so paid or which has been so short paid or to whom the refund has erroneously been made, or who has wrongly availed or utilised input tax credit, requiring him to show cause as to why he should not pay the amount specified in the notice along with interest payable thereon under section 50 and a penalty equivalent to the tax specified in the notice. (2) The proper officer shall issue the notice under subsection (1) at least six months prior to the time limit specified in sub-section (10) for issuance of order. (3) Where a notice has been issued for any period under sub-section (1), the proper officer may serve a s....
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....e of erroneous refund. (11) Where any person served with an order issued under sub-section (9) pays the tax along with interest payable thereon under section 50 and a penalty equivalent to fifty per cent. of such tax within thirty days of communication of the order, all proceedings in respect of the said notice shall be deemed to be concluded. [(12) The provisions of this section shall be applicable for determination of tax pertaining to the period upto Financial Year 2023-24.] Explanation 1 : For the purposes of section 73 and this section, - (i) the expression "all proceedings in respect of the said notice" shall not include proceedings under section 132; (ii) where the notice under the same proceedings is issued to the main person liable to pay tax and some other persons, and such proceedings against the main person have been concluded under section 73 or section 74, the proceedings against all the persons liable to pay penalty under [sections 122 and 125] are deemed to be concluded. [***]" 26. Thus, from the reading of Section 74, it is clear that where the authorities find that any tax has not been paid or erroneously re....