TaxTMI 
TaxTMI 
2026 (6) TMI 434
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....he corresponding provisions of the SGST Act and the IGST Act was also directed to be recovered for delayed payment of tax and a penalty of Rs. 69,56,794/- was imposed under Section 74(1) read with Section 122 of the CGST Act, 2017 and Section 20 of the IGST Act, 2017. 3. Having considered that the similar matter has already been decided by a Division Bench of this Court and as agreed to by the learned counsel for the parties, this writ petition is heard and dispose of at the motion stage itself. 4. The petitioner is the proprietor of M/s Sree Guru Metal, having its office at Radha Madhab College Road, Ward No. 13, Silchar, Assam. It is the case of the petitioner that upon introduction of the GST regime, which replaced various indirect taxes such as VAT, excise duty and service tax, several practical difficulties were faced by the business entities during the initial phase of implementation, particularly in filing GSTR-1 and GSTR-3B returns as the sales return and the summary return of the monthly tax payment with liability details and input tax credit (ITC) claim and there were incorrect data entry discrepancies in reporting output tax liability and input tax credit (ITC) and....
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....ity of hearing was granted and no notice was uploaded on the GST portal and were only manually served on the petitioner beyond the date of hearing. Consequently, the adjudicating authority proceeded to pass the impugned Order-in-Original dated 28.03.2024 without affording a meaningful opportunity of hearing and without issuance of Form GST DRC-07. The petitioner further contends that the sole basis for denial of ITC is the alleged failure of the suppliers to discharge their tax liability, a circumstance which is entirely beyond the control of the petitioner. The petitioner had paid full tax to the supplier and he had no involvement on the affairs of the said supplier and had acted in good faith by verifying tax invoices, receiving goods and making payment through proper banking channels including applicable GST. Even if the allegation of non-supply of goods is accepted, no tax can be levied in absence of actual supply as the GST is leviable only on supply of goods which is fortified by the Circular dated 06.07.2022, which clarifies that when there is no supply, no tax can be demanded. 10. It is the further case of the petitioner that Sections 73 & 74 of CGST Act, 2017 could not ....
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....unished. In other words, a purchasing dealer cannot be punished for the act of selling dealer in case the selling dealer had failed to deposed the tax collected by it. The relevant paragraphs of the judgment are reproduced herein below: "4. Before the Delhi High Court, the validity of Section 9(2)(g) of the Delhi Value Added Tax Act, 2004 was under challenge. The said provisions of the Delhi Value Added Tax Act are analogous to the provisions of Sections 16(2)(c) and 16(2)(d) of the Assam Goods and Services Tax Act, 2017 as well as Sections 16(2)(c) and 16(2)(d) of the Central Goods and Services Tax Act, 2017. The Delhi High Court in the said judgment has observed as under:- "39. Applying the law explained in the above decisions, it can be safely concluded in the present case that there is a singular failure by the Legislature to make a distinction between purchasing dealers who have bona fide transacted with the selling dealer by taking all precautions as required by the DVAT Act and those that have not. Therefore, there was need to restrict the denial of ITC only to the selling dealers who had failed to deposit the tax collected by them and not punish bona fide ....
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...., however, the Department is able to come across material to show that the purchasing dealer and the selling dealer acted in collusion then the Department can proceed under section 40A of the DVAT Act." 6. The Hon'ble Supreme Court has dismissed the SLP preferred against the said judgment by passing the following order:- "On hearing learned Additional Solicitor General appearing for the petitioner, we are not inclined to interfere with the impugned order. The special leave petition is dismissed. Learned Additional Solicitor General, however, submits that a batch of petitions were decided by the impugned order and there are some of the cases where the purchase transactions are not bona fide like the present case and those cases ought to have been remitted back to the competent authority. The learned Additional Solicitor General submits that the petitioner would move the High court with necessary particulars for directions in this behalf for which liberty is granted, as prayed for. Pending application(s), if any, stand disposed of." 7. Having gone through the above referred judgments, we are of the view that the controversy raised....