TaxTMI 
TaxTMI 
2026 (7) TMI 59
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.... 35974 and 35976 of 2024 [Fastenex Private Limited] and W.P.Nos. 14487, 14492 and 14500 of 2025 [Ispahani Estates Private Limited]. The argument of the Learned Senior Counsel for the Petitioner was also captured in the said order as this case was argued along with the batch. 5. I have explained the legal position in the said common order insofar as the challenge to proceedings invoking extended period of limitation under Section 74 of the respective GST Enactments. The ratio in the above mentioned common order will apply mutatis mutandis to the facts of the present case. The decision arrived herein has been Tabulated in the said Common Order. Therefore, this order is to be read in conjunction with the said Common Order. 6. For the sake of completion, I shall also give additional reasons for coming to the conclusion in this separate order in so far as the case of the Petitioner is concerned. Before that I shall briefly narrate the facts of this case. 7. In these Writ Petitions, the Petitioner has challenged the respective Show Cause Notices dated 10.05.2024 issued by the Respondent under Section 74 of the respective GST Enactments for the Tax Period between 2018-2019 and 20....
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.... 14. It is submitted that in the light of the aforesaid Audit Report in Form GST ADT-02 dated 28.02.2023, particularly, Item Nos.8 and 9, the Show Cause Notices was issued under Section 73 of the respective GST Enactments in GST DRC-01 dated 28.08.2023 for the Assessment Years 2018-19 and 2019-20. These Show Cause Notices culminated in two separate Assessment Orders both dated 10.10.2023 in respect of which summary was issued in DRC 07. 15. The learned Senior Counsel for the Petitioner would further submit that since the issue arose on account out of merger/de-merger, no notice issued could be under Section 74 of the respective GST Enactments separately. However, subsequently, the impugned Show Cause Notices dated 10.05.2024 have been issued for the very same tax period and is thus contrary to the law settled by the Hon'ble Supreme Court in Nizam Sugar Factory Ltd. Vs Collector of Central Excise 2006 (178 E.L.T 465). 16. It is submitted that the impugned Show Cause Notices are further bereft of details to justify the invocation of the extended period of limitation under Section 74 of the respective GST Enactments. 17. On merits, the learned Senior Counsel for the Petitio....
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....CL company was transferred in the name of the Petitioner under Section 18(3) of the respective GST Enactments. 25. A Division of the Petitioner which was also demerged and merged with M/s.Chemplast Cuddalore Vinyls Limited which also had tax implications on the Petitioner. This was subject matter of an audit under Section 65(6) of the respective GST Enactments for the Tax Period 2017- 2018 to 2020-2021 in respect of which Audit Report in Form GST ADT-02 dated 28.02.2023 was issued. 26. The limitation for passing orders under Section 73 and Section 74 of the respective GST Enactments would have expired on the following dates for the respective Tax Period:- Tax Period Last date for filing Return in GSTR 9 & GSTR 9C Last date for passing order under Section 73 Last date for passing order under Section 74 2018-2019 31.12.2019 31.12.2022 31.12.2024 2019-2020 31.12.2020 31.12.2023 31.12.2025 27. As per the decision of this court in M/s.Tata Play Limited, Represented by its Authorized Signatory and others Vs. Union of India, Through its Secretary and others, in W.P.Nos.17184 of 2024 etc., batch dated 12.06.2025 rendered on 12.06.2025 and as mod....
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....ble to the facts of the case, merely the Department was aware of the relevant facts, when earlier Order was passed invocation of extended period of limitation was thus available in the facts of the present case. 31. The decision of the Hon'ble Supreme Court in Nizam Sugar Factory case (referred to supra), dealt with a case where the Department had issued the 1st Show Cause Notice under Section 11A of the Central Excise Act, 1944 to the Appellant therein on 28.02.1984 for the period between February 1978 and September 1982. 32. There, it was alleged that the said company had cleared Carbon Dioxide without payment of duty to another unit in contravention to Rule 9(1) of the Central Excise Rules, 1944 without obtaining license for manufacturing of Carbon Dioxide in the Factory and without filing of classification list and price list and without maintaining the accounts. 33. There the case was heard on 16.04.1984 and thereafter no action was taken in the matter. Subsequently, a 2nd Show Cause Notice was issued on 16.07.1987 for the Tax Period between 1982-1983 and 1986-1987. 34. Thereafter, the Appellant therein was issued with 3rd Show Cause Notice dated 12.09.1988 for the....
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.... 2019-2020 DRC- 01A 20.06.2023 (27.01.2023) NA* NA* DRC- 01 28.08.2023 44,92,32,679 12,79,89,699 DRC- 07 10.10.2023 NA* NA* Revised DRC-07 24.05.2024 3,31,38,004 3,36,21,987 Note:- * Not available in the type set details. 43. The above Show Cause Notices and Assessment Orders passed under Section 73 of the respective GST Enactments were on the following heads namely:- DRC- 01 (Dt: 28.08.2023) Revised DRC-07 (Dt: 24.05.2024) (u/s 73) Heads FY: 2018-19 FY: 2019-20 1. Excess availment of ITC - mismatch between GSTR 2A & 3B ✓ ✓ 2. CSR (dropped)* ✓ ✓ 3. Corporate Guarantee (dropped)* ✓ ✓ 4. Blocked Credit ✓ ✓ 5. Remuneration paid to independent directors (dropped)* ✓ NA 6. OHC obligation (dropped)* ✓ ✓ 7. Provision for staging cricket matches (dropped)* ✓ ✓ 8. Related party transactions (dropped)* ✓ ✓ 9. MCA obligations ✓ ✓ 10. Credit Note issued (dropped)* ✓ ✓ 11. TDS Receipts (dropp....
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....e tax. This would have been specified in ASMT 10 dated 16.05.2023, copy of which is not in the court file. 48. Snapshot of the tax demand amount alone for these two Assessment Years pursuant to the Audit report in ASMT 10 are as under:- ASMT 10 dated 16.05.2023 Form Date 2018-19 2019-2020 DRC- 01A 05.12.2023 (21.12.2023) 312,40,76,030 41,72,96,000 DRC- 01 (impugned) 10.05.2024 312,40,76,030 41,72,96,000 49. For the respective Tax Periods returns would have been already filed before the last date for filing of Annual Return in GSTR-9 and the Reconciliation Statement in GSTR-9C. The credit that was availed in the Books of Account by the Petitioner before the appointed date i.e., 31.12.2019 was to be reversed to the extent of demerger of its Division to M/s.Chemplast Cuddalore Vinyls Limited. 50. The impugned Show Cause Notices both dated 10.05.2024, have been issued pursuant to Scrutiny of the Returns under Section 61 of the respective GST Enactments by invoking the machinery under Section 74 of the respective GST Enactments. 51. The petitioner has replied merely to the aforesaid Intimation in DRC-01A both dated 0....
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....d. 56. The impugned Show Cause Notices have been issued after comparing the Financial Statements with the appointed date in the NCLT order dated 29.04.2019 with reference to Table 12(f) of GSTR-9C Reconciliation Statement submitted by the Petitioner as was required under Rule 80(3) of the respective GST Rules for the respective Assessment Years. 57. The impugned Show Cause Notices correctly state that there is no restrictions in utilizing the Input Tax Credit and thus GST law imposes restrictions on the time period to avail Input Tax Credit. This could be however subject to relaxation vide Fianance (No. 2) Act, 2024 (15 of 2024), dated 16.08.2024, w.e.f. 27.09.2024 vide SO 4253(E), dated w.r.e.f. 01.07.2017. 58. As mentioned above, in the light of the decision of this court in M/s.Tata Play Limited, Represented by its Authorized Signatory and others Vs. Union of India, Through its Secretary and others referred to supra, even otherwise the impugned Show Cause Notices issued on 10.05.2024 can be said to have been issued in time even for passing order under Section 73 of the respective GST Enactments for any reason other than fraud or wilful-misstatement or suppression of fac....