2026 (2) TMI 654

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....dent(s): Mr. Bibhal Nandi Majumder, Sr. Advocate, Mr. Bidyut Majumder, Deputy SGI, Mr. Mangal Debbarma, Addl. G.A., Mr. Samrat Sarkar, Advocate, Mr. Biplabendu Roy, Advocate. JUDGMENT & ORDER (ORAL) Petitioner is a partnership firm carrying on business of rubber in various parts of the country including the State of Tripura. It was registered under the CGST Act, 2017 and also under the SGST Act, 2017. 2. For the purpose of carrying on its business, it had to purchase certain materials which are used in furtherance of manufacturing of finished products from respondent No. 7 for the period stretching from 08.03.2018 to 30.11.2018. 3. According to the petitioner, prior to effecting purchases of the input materials from respondent N....

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....itself is vague, evasive, and the allegations are mutually contradictory, and because it is vague, the show cause notice itself cannot be sustained. 10. Petitioner also contended that Section 16(2)(c) has been wrongly invoked to deny ITC to the petitioner, since the transaction between the petitioner and the seventh respondent was a bona fide transaction, and there was no mechanism under the CGST/SGST Act, 2017 by which the petitioner could compel the seventh respondent to discharge to the respective governments' duty to make over the tax collected by him from the petitioner, and for the default of the seventh respondent in making over the tax paid by the petitioner for the purchase of materials to the respective governments, petitioner ....

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....g dealer deposits the GST collected from him with the Government. It thus concluded that Section 16(2)(c) of the Act places an onerous burden on a bona fide purchasing dealer, and in such circumstances if the law seeks to visit disproportionate consequences on a bona fide purchasing dealer, it will become vulnerable to invalidation on the touchstone of Article 14 of the Constitution of India. It therefore held that the principle of reading down the said provision has to be applied, to save it from the vice of unconstitutionality. It concluded that there is nothing in the language in the Act which expressly enables the respondents to tax a purchaser, who has already paid taxes to the seller, a second time by denying him ITC in all situati....