Delhi HC Directed Refund of Amount Deposited Coercively During Search Operations at Midnight

Case Details: Neeraj Paper Marketing Ltd. v. Special Commissioner, Department of Trade & Taxes, GNCTD - [2024] 158 taxmann.com 470 (Delhi)

Judiciary and Counsel Details

• • Vibhu Bakhru & Amit Mahajan, JJ.
  • Shammi Kapoor, Mrs Kavita Jha, Vishal Kumar, Sandeep Gupta & Ms Prachi Jain, Advs. for the Petitioner.
  • Rajvee Aggarwal, Ms Shipla Singh, Chiranjeev Kumar, Kukesh Sachdeva & Dipanshu Gaba, Advs. for the Respondent.

Facts of the Case

In the present case, the GST department conducted search in the premises of petitioner and found mismatch in entries of GSTR-2A and GSTR-3B in two assessment years. The petitioner acknowledged the discrepancies and contended that ITC availed was correct. However, the officers coerced them into depositing the amount under GST DRC-03 in mid-night. It filed writ petition and requested to refund the amount.

High Court Held

The Honorable High Court noted that the petitioner acknowledged the discrepancies but the officers coerced them into depositing the amount under GST DRC-03 in mid-night. The Court further noted that the prescribed procedure for voluntary deposit was not followed as acknowledgement was not issued for payment. Also, the Show Cause Notice (SCN) was issued but the amount paid during investigation was not taken into account in demand.

Therefore, the Court held that the amount paid in mid-night was under compelling circumstances and not voluntary. Thus, the Court directed the department to refund the amount with interest.