Lucas TVS Limited Vs Superintendent of GST

The writ petition in question has reached the final disposal stage with the agreement of both parties involved. The petitioner has filed this petition seeking a Mandamus, specifically requesting the second respondent to release funds that have been blocked in the petitioner’s bank account. This account is held with the fourth respondent, and its account number is 35277200625. Additionally, the petitioner seeks a directive from the court to prevent the second respondent from blocking funds in any other bank account belonging to the petitioner unless the proper legal procedures are followed.

The writ petition under discussion involves a dispute concerning the release of blocked funds in the petitioner’s bank account, specifically Account Number 35277200625, held with the fourth respondent. The petitioner seeks a Mandamus directing the second respondent to release these funds and to refrain from blocking funds in any other bank account of the petitioner without following due legal procedures.

The petitioner’s grievances stem from their filing of GSTR-3B for July 2017 on 19.08.2017, during which they encountered technical glitches on the GST Portal that hindered the accurate capture of Input Tax Credit (ITC) eligibility. Consequently, the petitioner manually deducted the ITC they believed they were eligible for, amounting to Rs.9,40,30,477/-, from their gross output GST payable, providing a final net output tax liability of Rs.8,29,34,603/-.

Later, when filing the annual GST return for the financial year 2017-18 in GSTR-9 on 30.01.2020, the petitioner reflected the actual availed ITC and output GST liability. They assert that the reconciliation statement filed in GSTR-9C highlighted the discrepancy in the ITC between GSTR-3B and GSTR-9 in Table 13A.

The dispute escalated when the first respondent issued summons to the petitioner on 28.10.2022, alleging short payment of tax in July 2017. The petitioner contends that they participated in the inquiry on 31.10.2022 but were not provided a copy of the statement recorded. Subsequently, on 05.12.2022, the second respondent issued summons to the petitioner for alleged non-payment of GST concerning certain transactions in July 2017.

The petitioner argues that they have complied with the tax regulations and rectified any discrepancies in subsequent filings. They seek relief from the court to release the blocked funds and prevent further arbitrary blocking of funds without proper legal process.

Both parties have consented to expedite the resolution of this matter, allowing the writ petition to be taken up for final disposal at the admission stage itself.

The writ petition in question involves a dispute over blocked funds in the petitioner’s bank account, specifically Account Number 35277200625, held with the fourth respondent. The petitioner seeks a Mandamus directing the second respondent to release the blocked funds and to prevent future blockage of funds without due legal process.

The petitioner explains that they filed their GSTR-3B for July 2017 on 19.08.2017 but encountered technical issues on the GST Portal, resulting in the inability to properly record Input Tax Credit (ITC) eligibility. They manually adjusted the ITC, declaring an output GST liability of Rs.8,29,34,603/-. Subsequently, when filing the annual GST return for the financial year 2017-18 (GSTR-9) on 30.01.2020, they corrected the ITC discrepancy.

The first respondent issued summons to the petitioner on 28.10.2022 for alleged tax underpayment in July 2017, followed by another summons from the second respondent on 05.12.2022 for non-payment of GST on certain transactions. The petitioner attended both inquiries but claims they were not provided copies of their statements.

On 12.12.2022, the first respondent issued a notice to reconcile various GST returns for July 2017, to which the petitioner responded on 15.12.2022, requesting an extension. They subsequently submitted details on 30.12.2022 and 19.01.2023.

The petitioner discovered the blockage of funds in their bank account when attempting to use it. They requested copies of the notices leading to the blockage from both the first and fourth respondents but have not received them. The fourth respondent replied on 27.01.2023, stating that the second respondent had directed them to block the funds under Section 79(1)(c)(i) of the CGST Act, 2017.

The petitioner, therefore, seeks relief from the court to release the blocked funds and prevent arbitrary blockage of funds without following due process. Both parties consented to the final disposal of the writ petition at the admission stage itself.

Download PDF:
Lucas TVS Limited

For Reference Visit:
Madras High Court

Read Another Case Law:
GST Case Law