Torrent Power Ltd VS Union Of India

In a legal case argued by Mr. Uchit N. Sheth for the petitioner and Mr. Priyank Lodha for the respondents, the petitioner, a Public Limited Company registered under the GST Act, engages in importing natural gas. Upon importing goods into the country, the petitioner files a bill of entry for home consumption, paying customs duty, countervailing duty, and other applicable duties on the total value of the goods.

In a legal case argued by Mr. Uchit N. Sheth for the petitioner and Mr. Priyank Lodha for the respondents, the petitioner, a Public Limited Company registered under the GST Act, imports natural gas. Upon import, the petitioner files a bill of entry for home consumption and pays customs duty, countervailing duty, and other applicable duties based on the CIF value of the goods.

The dispute revolves around Section 5(3) of the IGST Act, which allows the government to specify categories where the recipient of goods or services must pay taxes on a reverse charge basis. Entry No. 10 of the Reverse Charge Notification specifies such services. The petitioner argues for clarification and compliance regarding the reverse charge mechanism under this provision.

The case involves a petition filed under Article 226 of the Indian Constitution by a Public Limited Company registered under the Central Goods and Services Tax Act, 2017, engaged in importing natural gas. The petitioner contends that upon importing goods into the country, they pay various duties including customs duty based on the CIF (Cost, Insurance, and Freight) value. They argue that under Section 5(3) of the Integrated Goods and Services Tax (IGST), certain categories of goods or services are subject to reverse charge, as specified by the government.

Specifically, Entry No. 10 of Notification No. 10 of 2017 dated 28.06.2017 imposes IGST on the recipient of such services, which the petitioner claims applies to their transactions. They seek a refund of Rs. 3,06,56,341/- plus interest of Rs. 14,38,963/-, previously paid under this provision. The petitioner challenges the rejection of their refund claim by the authorities on October 13, 2021.

Following the introduction of the Goods and Services Tax (GST) from July 1, 2017, Notification No. 8 of 2017 dated June 28, 2017 stipulated a 5% IGST on interstate supply of services involving vessel transportation. Another Notification No. 10 of 2017 issued on the same date specified services by non-taxable persons in a similar context.

The matter is argued by Mr. Uchit N. Sheth for the petitioner and Mr. Priyank Lodha for the respondents, with the petitioner seeking judicial intervention to compel the refund and overturn the previous ruling.

In a legal case involving a Public Limited Company registered under the GST Act, engaged in importing natural gas, the petitioner filed a petition under Article 226 of the Constitution of India. The petitioner sought a directive to the authorities to refund GST amounting to Rs. 3,06,56,341/- along with interest of Rs. 14,38,963/-. This claim was based on Entry No. 10 of Notification No. 10 of 2017, which concerns the reverse charge mechanism under IGST.

The petitioner argued that they paid customs duty and other applicable duties upon importation, including IGST under Notification No. 10 of 2017. This notification, along with others, initially imposed IGST on services related to transportation of goods by vessel from outside India to the Customs Clearance Station in India. However, legal challenges were raised against the validity of these notifications.

The court previously ruled in cases such as Mohit Minerals Pvt. Ltd. vs. Union of India and subsequent cases that Notification Nos. 8 and 10 of 2017, along with their corrigendum, were unconstitutional and ultra vires the statute. These decisions held that the notifications improperly imposed IGST under the reverse charge mechanism, contradicting established legal principles.

Therefore, the petitioner sought to overturn the order rejecting their refund claim, arguing that the notifications in question were invalid, and they were entitled to a refund of the IGST paid under the reverse charge mechanism.

In a recent legal case argued by Mr. Uchit N. Sheth for the petitioner and Mr. Priyank Lodha for the respondents, the petitioner, a Public Limited Company registered under the GST Act, is involved in importing natural gas. Upon import, the petitioner pays various duties based on the CIF value. The dispute arises from Section 5(3) of the IGST Act, which mandates reverse charge for specified categories of goods and services. The petitioner filed a petition under Article 226 seeking a refund of Rs. 3,06,56,341/- GST and interest, citing Entry No. 10 of Notification No. 10 of 2017.

Following the introduction of GST from July 1, 2017, Notification No. 8 and Notification No. 10, both dated June 28, 2017, imposed IGST on inter-state services, particularly those involving transportation by vessel from a non-taxable territory to India. A corrigendum issued on June 30, 2017, adjusted the IGST rate to 10% of the CIF value in certain circumstances.

The validity of these notifications was previously challenged and struck down as unconstitutional by the court in the case of Mohit Minerals Pvt. Ltd. vs. Union of India. This decision has since been upheld and followed in subsequent cases like Gokul Agro Resources Ltd. vs. UOI, Bharat Oman Refineries Ltd. vs. Union of India, and Comsol Energy Private Limited vs. State of Gujarat.

The court’s ruling in Mohit Minerals Pvt. Ltd. established a precedent that the notifications in question were unconstitutional and beyond the statutory authority. This legal position was acknowledged by both parties’ advocates, affirming its applicability to the current case before the.

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