Abis Export India Private Limited VS State of Chhattisgarh

The petitioner has lodged a writ petition challenging the decision dated 11.09.2018 (Annexure P/1), which dismissed their appeal filed under Section 50(1) of the Central Goods and Services Tax Act, 2017 (referred to as “the Act, 2017”). The appeal was turned down on the grounds that the petitioner failed to settle the tax, interest, fine, fee, and penalty stemming from the disputed order dated 03.08.2018. This dismissal was deemed a violation of Section 107(6) of the Act.

This writ petition challenges two orders: one dated 11.09.2018 (Annexure P/1), which rejected the petitioner’s appeal under Section 50(1) of the Central Goods and Services Tax Act, 2017 (referred to as “the Act, 2017”), citing non-payment of tax-related amounts from the impugned order dated 03.08.2018. The second order, dated 03.08.2018 (Annexure P/2), directed the petitioner to pay interest of Rs. 72,69,975.00 within 7 days.

The petitioner, a company engaged in various productions including pet food, had sold pet food, classified under Harmonized System Code (HSN) 2309, without charging GST due to unclear instructions or notifications regarding its taxation. While the petitioner approached authorities to rectify their returns upon realizing the taxable nature of pet food, no mechanism was provided for rectification. Despite not availing input credit or charging customers for GST, the petitioner adjusted tax liabilities in their returns for July to September 2017. However, the authority demanded interest of Rs. 73,52,955/- based on return differences, including GST, SGST, and IGST.

The petitioner argues against tax liability, asserting that they neither availed input credit nor charged customers for GST on pet food. They set off the tax liability in their March 2018 return for the period of July to September 2017. The appeal against the interest demand was dismissed due to non-compliance with sub-section provisions.

In summary, the petitioner contests two orders regarding GST appeal rejection and interest demand, citing unclear tax instructions for pet food, lack of rectification mechanisms, and no tax liability on pet food sales.

The petitioner has lodged a writ petition contesting two orders: one dated 11.09.2018 rejecting their appeal under Section 50(1) of the Central Goods and Services Tax Act, 2017 (CGST Act) due to non-payment of tax, interest, fine, fee, and penalty stemming from an earlier order dated 03.08.2018, and the other dated 03.08.2018, directing them to pay interest amounting to Rs. 72,69,975.00, with a demand notice to be issued within 7 days.

The petitioner, a company engaged in various productions including pet food, found ambiguity regarding the taxation of pet food under the CGST Act. While pet food falls under Harmonized System Code (HSN) 2309 and is a taxable commodity, the absence of clear instructions or notifications regarding its taxation led the petitioner to sell it to distributors without charging GST initially. However, upon realizing the taxation obligation, the petitioner approached authorities to rectify their returns, but the lack of a mechanism hindered this process.

The petitioner contends that they have no tax liability as they neither availed input credit nor charged GST to customers for pet food. They adjusted the tax liability in their returns for the period of July 2017 to September 2017. Despite this, interest was demanded based on return discrepancies. The petitioner’s appeal against this demand was dismissed citing non-compliance with Section 107(6) of the CGST Act. Additionally, no appellate tribunal had been constituted at the time, leaving the petitioner in limbo.

The petitioner seeks several reliefs through the writ petition, including the quashing of the impugned orders, the demand notice, and the GST DRC-13 issued in pursuance of the order dated 03.08.2018. They also request any other suitable relief the court deems fit and proper, along with the costs of the petition.

The petitioner’s counsel argues that the confusion arose due to the lack of clarity in the law. Despite seeking clarification from various state authorities, including obtaining registration under the GST Act and being informed that HSN Code 2309 is exempted from tax, the petitioner faced conflicting information. Only after selling pet food without charging GST did they learn about the exemption specifically excluding pet food. This confusion persisted despite repeated inquiries.

In summary, the petitioner contends that their actions were based on genuine confusion arising from the lack of clarity in the law and conflicting information received from authorities. They seek relief from the adverse consequences resulting from this confusion, particularly the demand for interest and the dismissal of their appeal.

The petitioner has filed a writ petition challenging two orders: one dated 11.09.2018, which rejected their appeal under Section 50(1) of the Central Goods and Services Tax Act, 2017 (referred to as “the Act, 2017”), and another dated 03.08.2018, which directed the petitioner to pay a significant amount of interest and issued a demand notice within 7 days. The petitioner, a company engaged in the production of various commodities including pet food, had sold pet food to distributors without charging Goods and Services Tax (GST) due to a lack of clear instructions or notifications regarding taxation on animal and pet food under the Act. Despite efforts to rectify the situation by approaching authorities and seeking guidance on correcting their returns, the petitioner faced demands for payment of interest based on differences in their return filings.

The petitioner contends that they had no tax liability on pet food as they neither availed input credit nor charged GST to customers. They attempted to rectify their return by setting off the tax liability in subsequent filings. However, the taxing authority insisted on payment of interest, disregarding the non-taxable nature of the petitioner’s products. Despite the petitioner’s efforts to explain and rectify the situation, authorities failed to provide a mechanism for correction in the return filing process.

The petitioner seeks relief from the court to quash the impugned orders and demand notice, as well as any other necessary directions in the interest of justice. The petitioner argues that they had sought clarification from authorities regarding the tax status of their products and had attempted to correct their filings accordingly, but faced unjust demands for payment of interest without a clear mechanism for correction provided by the authorities.

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