TaxTMI 
TaxTMI 
2026 (8) TMI 1442
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....SGST Act"). The appellants have opted for and have been availing the benefit of the composition scheme prescribed under the Act. In terms of the said scheme, the appellants were liable to discharge tax at the prescribed composition rate of 1% in respect of the impugned goods under the TSGST Act as well as under the Central Goods and Services Tax Act, 2017 (hereinafter referred to as "the CGST Act"). 3.0 During the relevant tax periods, the appellants were governed by the composition scheme under Section 10(1) of the TSGST Act, as applicable in the State of Telangana, read with the CGST Act, the prescribed aggregate turnover threshold being Rs.1.50 crore. Upon the aggregate turnover of a registered person exceeding the said statutory limit, such person ceases to be entitled to continue under the composition scheme and becomes liable to discharge tax at the applicable regular rate, in accordance with law, in lieu of the concessional composition levy. 4.0 The appellants were subjected to audit by the jurisdictional Audit Officers. Upon examination and comparison of the turnover reflected in the e-way bills generated by the appellants during the relevant periods with the tu....
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..... 4.7 Upon adjudication, however, the proper officer restricted the confirmation of the tax demand to the applicable rate of 5%, in proceedings initiated under Section 73 of the TSGST Act. The proper officer further ordered recovery of applicable interest in terms of Section 50(1) of the Act and imposed a penalty equivalent to 10% of the tax under Section 73 of the Act. 4.8 Aggrieved by the said order, the appellants preferred appeals before the First Appellate Authority. The First Appellate Authority, however, upheld the order passed by the adjudicating authority and dismissed the appeals. 4.9 Being aggrieved by the impugned order, the appellants have preferred the present appeals before this Bench in respect of both the aforesaid financial years. 4.10 The appellants seek setting aside of the impugned order; restoration and continuation of the benefit of the composition scheme; annulment of the demands towards tax, interest and penalty; and refund of the amounts deposited by them as pre-deposit, together with all consequential reliefs. 5.0 The principal issue that arises for consideration in the present appeals is whether, during the respective financial years under....
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.... It is further submitted that the aforesaid demand has been determined after duly taking into account and allowing for the errors appearing in the e-way bills. The learned DR, therefore, prays that the appeals filed by the appellants be dismissed and the demands confirmed by the lower authorities be sustained. 13.0 The learned DR submits that he has no further submissions to make and requests that the matter be decided on the basis of the submissions already placed on record. 14.0 It is an admitted position that the appellant exceeded the prescribed threshold limit of aggregate turnover in both the financial years under consideration. A plain reading of Section 10(3) of the Act makes it abundantly clear that the option exercised under the composition scheme ceases to operate from the date on which the aggregate turnover of the registered person exceeds the threshold limit of Rs.1.50 crore prescribed under Section 10(3) of the Act. Upon such cessation, the registered person becomes liable to discharge tax at the applicable rate under the regular scheme, instead of the concessional rate prescribed for composition taxpayers. The relevant provision is reproduced below: "....
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.... all supplies made on and after the date of such lapse, subject to due credit and adjustment of any composition tax already paid in respect of such post-lapse turnover. 16.0 It is further observed that the Department duly considered the appellants' contention regarding the typographical errors allegedly occurring in certain e-way bills raised by them. The impugned demand was determined after excluding the excess turnover attributable to such errors, as accepted by the Department. In the absence of any further oral submissions on behalf of either party beyond the written submissions already placed on record, and having regard to the material available before us, we find no sufficient ground to interfere with the figures determined in the impugned orders or with the findings recorded by the adjudicating authority. 17.0 Although no specific arguments were advanced by the learned Counsel regarding the method adopted for computation of the differential tax, we consider it appropriate to examine the issue in the light of Section 10(4) of the Act. The relevant provision is reproduced below: "(4) A taxable person to whom the provisions of sub-section (1) 10[or, as the case m....
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.... under the Act and the Rules, particularly when the relevant facts are already available on record. 18.1 Rule 35 is intended to ensure that tax is calculated on the value of the supply exclusive of the tax component. The authorities are required to determine the correct tax liability in accordance with law. They cannot collect tax in excess of what is legally payable merely because the taxpayer did not specifically claim a statutory benefit. 19.0 It is a settled principle that the Department must collect the tax legally due-neither more nor less. In this regard, reliance may be placed on the judgment of the Hon'ble Supreme Court in M/s. Unichem Laboratories Limited v. Collector of Central Excise, Bombay, reported in 2002-TIOL-237-SC-CX, wherein it was observed: "13. For the aforementioned reasons, we are of the view that denial of benefit of the notification to the appellant was unfair. There can be no doubt that the authorities functioning under the Act must, as are in duty bound, protect the interest of the Revenue by levying and collecting the duty in accordance with law - no less and also no more. It is no part of their duty to deprive an assessee of the benefit ....