Devices Distributors VS Assistant State Tax Officer

The petitioner, M/s Bagadiya Brothers Pvt. Ltd., a registered business under GST in Chhattisgarh, engages in import and export activities through various Indian ports, including Paradip Port in Odisha. The issue at hand concerns certain taxable services provided by the Paradip Port Trust (PPT) to the petitioner, for which the PPT had issued an intra-State invoice instead of an inter-State one. The petitioner, seeking the correct inter-State invoice, approached the High Court of Delhi, which directed them to address the matter with the jurisdictional GST Commissioner. Consequently, the petitioner submitted a representation to the Commissioner of CT & GST, Odisha, who advised the PPT to issue an inter-State IGST invoice to the petitioner.

Meanwhile, the petitioner had filed a writ petition in the High Court of Delhi, resulting in a clarification issued to the PPT by the Commissionerate of CT & GST, Odisha, advising the treatment of the supply as an interstate supply. Subsequently, on the advice of the Commissioner (GST Council), New Delhi, the Central Board of Indirect Taxes and Customs (CBIC) issued a clarification on June 28, 2019.

During the proceedings, counsel for the PPT stated that they would abide by the CBIC’s advice. Therefore, considering the clarification provided by the CBIC, the court directed the PPT to amend all invoices issued to the petitioner from July 2017 onwards, incorporating an 18% IGST instead of 9% CGST and 9% SGST, in compliance with the provisions of the IGST Act. The court ordered these corrections to be made manually by the State Commissionerate within eight weeks.

Furthermore, due to the ongoing COVID-19 situation, the court permitted the parties to utilize a printout of the order from the High Court’s website as equivalent to a certified copy, subject to attestation by the respective advocate.

In a separate case, the petitioner, a distributor of home appliances, challenged a detention notice served under the GST Act while transporting goods. The notice was issued due to discrepancies in the serial numbers of tax invoices accompanying the goods. The detaining authority suspected the use of intervening invoice numbers for undisclosed goods. The detention notice also referred to the Revised Invoice Rules, 2017, which the petitioner’s counsel argued as irrelevant to the case.

These cases exemplify legal proceedings involving GST issues and the enforcement of tax regulations, highlighting the importance of proper documentation and compliance with GST laws to avoid disputes and detentions.

The petitioner, M/s Bagadiya Brothers Pvt. Ltd., a business entity registered under GST in Chhattisgarh, engages in import and export activities through various ports, including Paradip Port in Odisha. They sought inter-State invoices for taxable services provided by Paradip Port Trust (PPT) but were issued intra-State invoices. Following a directive from the Delhi High Court to approach the jurisdictional GST Commissioner, the petitioner submitted a representation to the Commissioner of CT & GST, Odisha, who advised PPT to issue inter-State IGST invoices.

The issue appeared to be resolved after the Central Board of Indirect Taxes and Customs (CBIC) issued clarifications in June 2019, directing PPT to treat the supply of services to the petitioner as interstate and levy IGST instead of CGST and SGST. Despite this, PPT awaited further guidance from CBIC.

Given CBIC’s clarification, the court directed PPT to comply with it, amending all petitioner’s invoices from July 2017 onwards to levy 18% IGST instead of 9% CGST and 9% SGST. The court mandated these corrections within eight weeks, to be carried out manually by the State Commissionerate if necessary. The court also allowed the opening of the GST portal if required for this purpose.

Another case involved a petitioner, a distributor of home appliances, aggrieved by a GST detention notice issued during the transportation of goods. The detention was based on discrepancies in the serial numbers of tax invoices accompanying the goods. The detaining authority suspected the use of unreported invoices, potentially violating GST rules.

The court considered Rule 46(1)(b) of the GST Rules, which mandates consecutive serial numbers on tax invoices. As the invoices didn’t comply, the detention was argued as justified. However, the court observed that the power to detain under Section 129 of the GST Act applies to contraventions of the Act or Rules and emphasized the importance of proper documentation during transit. Despite the lack of compliance with Rule 46, the court found the detention unjustified, as it didn’t violate substantive GST provisions.

In both cases, the court’s decisions highlight the importance of compliance with GST regulations while also ensuring fair treatment and adherence to due process.

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