GST Department cannot collect double tax for one offence Delhi High Court  in WP(C) 2952/2023 & CM APPL. 42595/2023

The question before High Court in this petition is - whether GST Department can collect tax from supplier and transporter both for the same offence?

Brief:

The petitioner is a transporter and was engaged to transport the goods from Karnataka to New Delhi.

Intelligence Officer intercepted the truck. The driver of the said truck was directed to produce the necessary papers in respect of the said goods. He produced the invoice for the said goods, however, could not produce the E-Way Bill.

Thereafter, the concerned officer issued summons to the owner (In charge) to produce the necessary documents. The quantum of tax penalty and fine was quantified at Rs.40,85,375/-.

Since the truck was detained by the concerned officer, the petitioner deposited the quantified tax, penalty, and fine (Rs.40,85,375/-) with the GST Authorities by securing a temporary GSTIN.

Three days later, the supplier also deposited the quantified tax, penalty, and fine amounting to Rs.40,85,375/- in respect of the goods that were being transported by the petitioner.

Therefore, petitioner has filed this writ petition praying that GST Authorities be directed to refund the tax and fine of Rs.40,85,375/-, which was paid in respect of goods that were being transported without a valid E-Way Bill. The petitioner claims that the said amount has been paid twice over and the same is required to be refunded.

High Court:

It is apparent from above that the tax, penalty, and fine as quantified in GST MOV-10 has been paid twice over, one by the petitioner and second by the supplier.

Thus, there is merit in the contention that the petitioner would be entitled for refund since the petitioner was not the supplier of goods but was engaged in transporting the same.

As noted above, the petitioner paid the quantified amount of tax penalty and fine as his vehicle had been detained.

The petitioner’s grievance arises on account of his inability to file an application for refund online. It is stated that there is no option available in the portal for the petitioner to apply for a refund online.

Undisputedly, the tax penalty and fine quantified in GST MOV-10 dated 28.02.2022, cannot be collected twice over. The respondent authorities are, thus, required to refund the same.

Learned counsel appearing for Respondent No. 2 and 3, rightly points out that in the absence of facility under the GST portal, the petitioner may be directed to file an application for refund manually.

In view of the above, we consider it apposite to dispose of the petition by permitting the petitioner to make an application for refund manually to Respondent No. 3.

The concerned officer is directed to process the said application in light of the observations made above, as expeditiously as possible, preferably within a period of four weeks of the said application being made.

Full Text Of The Judgment 

1. The petitioner has filed the present petition, inter alia, praying that respondents be directed to refund the Goods and Services Tax amounting to ?40,85,375/-, which was paid in respect of arecanuts that were being transported without a valid E-Way Bill. The petitioner claims that the said amount has been paid twice over and the same is required to be refunded.

2. Briefly stated, the facts that are necessary to address the present controversy are as follows:

2.1 The petitioner states that one M/s Sharma Enterprise, Delhi had purchased dried arecanuts from Rohit Company (Rohit Sharma) in Karnataka. The petitioner, being a transporter, was engaged to transport the said goods from Karnataka to New Delhi in a vehicle / truck bearing Registration No. KA-14-C-2751.

2.2 On 26.02.2022, the Intelligence Officer intercepted the said truck at Songadh, Gujarat. The driver of the said truck was directed to produce the necessary papers in respect of the said goods. He produced the invoice for the said goods [Invoice No. 09 dated 21.02.2022 bearing the name of M/s Sharma Enterprises (Delhi)], however, could not produce the E-Way Bill.

2.3 Immediately thereafter on 27.02.2022, the concerned officer issued summons to the owner (In charge) to produce the necessary documents.

2.4 The quantum of tax penalty and fine was quantified at ?40,85,375/-.

2.5 Since the truck was detained by the concerned officer, the petitioner deposited the quantified tax, penalty, and fine (?40,85,375/-) with the GST Authorities by securing a temporary registration (GSTIN 072200000643AR1) on 01.03.2022.

2.6 Three days later, on 04.03.2022, the supplier (Rohit Sharma) also deposited the quantified tax, penalty, and fine amounting to ?40,85,375/- in respect of the goods that were being transported by the petitioner. After verification of the documents and being satisfied that the tax, penalty, and fine had been discharged, the concerned officer released the goods as well as the truck bearing No. KA-14-C-2751.

3. It is apparent from above that the tax, penalty, and fine as quantified in GST MOV-10 dated 28.02.2022, has been paid twice over, one by the petitioner and second by the supplier (Rohit Company).

4. Thus, there is merit in the contention that the petitioner would be entitled for refund since the petitioner was not the supplier of goods but was engaged in transporting the same.

5. As noted above, the petitioner paid the quantified amount of tax penalty and fine as his vehicle had been detained.

6. The petitioner’s grievance arises on account of his inability to file an application for refund online. It is stated that there is no option available in the portal for the petitioner to apply for a refund online.

7. Undisputedly, the tax penalty and fine quantified in GST MOV-10 dated 28.02.2022, cannot be collected twice over. The respondent authorities are, thus, required to refund the same.

8. Mr. Anurag Ojha, learned counsel appearing for Respondent No. 2 and 3, rightly points out that in the absence of facility under the GST portal, the petitioner may be directed to file an application for refund manually.

9. In view of the above, we consider it apposite to dispose of the petition by permitting the petitioner to make an application for refund manually to Respondent No. 3.

10. The concerned officer is directed to process the said application in light of the observations made above, as expeditiously as possible, preferably within a period of four weeks of the said application being made.

11. The petition is disposed of in the aforesaid terms.