Non-issuance of Notice u/s 61 would not Affect Validity of Proceedings Initiated u/s 74: HC

  • Blog|News|GST & Customs|
  • 2 Min Read
  • By Taxmann
  • |
  • Last Updated on 26 May, 2023

GST Notice u/s 61

Case Details: Nagarjuna Agro Chemicals (P.) Ltd. v. State of U.P. - [2023] 150 taxmann.com 419 (Allahabad)

Judiciary and Counsel Details

    • Ashwani Kumar Mishra & Vinod Diwakar, Jj.
    • Shubham Agrawal for the Petitioner.
    • C.S.C. for the Respondent.

Facts of the Case

The petitioner had submitted returns for period 2019-20. The GST department had not issued any notice under Section 61 of CGST Act, 2017 (the Act) but it initiated proceedings under Section 74 against petitioner on certain grounds with regard to classification and consequential tax payable of certain goods.

The department had examined issue and ultimately passed order whereby tax previously paid was found short and a demand had been raised for deposit of appropriate short fall in deposit of tax as also interest and penalty. It field writ petition against the assessment order and contended that the department must have pointed out deficiency in the returns submitted by the petitioner so as to give it an opportunity to rectify the return before proceeding under Section 74 of the Act.

High Court Held

The Honorable High Court noted that the scrutiny proceedings of return as well as proceeding under Section 74 are two separate and distinct exigencies. Therefore, the issuance of notice under Section 61(3) cannot be construed as a condition precedent for initiation of action under Section 74 of the Act.

Thus, the Court held that merely because no notices were issued under Section 61 of the Act, it would not mean that issues of classification or short payment of tax could not be dealt with under Section 74 as exercise of such power was not dependent upon issuance of notice under Section 61. The Court dismissed the writ petition and the petitioner was permitted to prefer appeal against the impugned order.

Disclaimer: The content/information published on the website is only for general information of the user and shall not be construed as legal advice. While the Taxmann has exercised reasonable efforts to ensure the veracity of information/content published, Taxmann shall be under no liability in any manner whatsoever for incorrect information, if any.

Leave a Reply

Your email address will not be published. Required fields are marked *

Everything on Tax and Corporate Laws of India

To subscribe to our weekly newsletter please log in/register on Taxmann.com

Author: Taxmann

Taxmann Publications has a dedicated in-house Research & Editorial Team. This team consists of a team of Chartered Accountants, Company Secretaries, and Lawyers. This team works under the guidance and supervision of editor-in-chief Mr Rakesh Bhargava.

The Research and Editorial Team is responsible for developing reliable and accurate content for the readers. The team follows the six-sigma approach to achieve the benchmark of zero error in its publications and research platforms. The team ensures that the following publication guidelines are thoroughly followed while developing the content:

  • The statutory material is obtained only from the authorized and reliable sources
  • All the latest developments in the judicial and legislative fields are covered
  • Prepare the analytical write-ups on current, controversial, and important issues to help the readers to understand the concept and its implications
  • Every content published by Taxmann is complete, accurate and lucid
  • All evidence-based statements are supported with proper reference to Section, Circular No., Notification No. or citations
  • The golden rules of grammar, style and consistency are thoroughly followed
  • Font and size that's easy to read and remain consistent across all imprint and digital publications are applied