Nafr High Court
Case Details
1 2025:CGHC:41760 NAFR HIGH COURT OF CHHATTISGARH AT BILASPUR W.P(T) No.85 of 2025 Siddhant Steels Through Its Proprietor Sajan Agrawal, Son Of Shri Girdhari Lal Agrawal Aged About 52 Years, R/o. Near Siddhant Steels, Ring Road No. 2, Gaurav Path, Tehsil And District - Bilaspur (C.G.) ... Petitioner versus 1 - State Of Chhattisgarh Through Secretary, Department Of Finance, Government Of Chhattisgarh, Mantralaya, Mahanadi Bhawan, Atal Nagar, Nava Raipur, Raipur, District - Raipur (C.G.) 2 - Deputy Commissioner Division No. 1, State Goods And Services Tax, Tehsil And District - Bilaspur (C.G.) SISTLA NEELIMA VISHNU PRIYA Digitally signed by SISTLA NEELIMA VISHNU PRIYA Date: 2025.08.20 10:52:50 +0530 3 - Assistant Commissioner Circle No. 2, State Goods And Services Tax, Tehsil And District - Bilaspur (C.G.) 4 - Commissioner State Goods And Services Tax, GST 2 Department, North Block, Sector-19, Atal Nagar, Naya Raipur, Tehsil And District - Raipur (C.G.) ... Respondents For Petitioner:
Legal Reasoning
very high. He further submits that prima facie, the Proper Officer found tax liability of Rs.25 lacs to which, the Petitioner/Firm has failed to produce relevant documents against the entry made in outward supply and the Petitioner has voluntarily made a deposit of Rs.12 lacs and Sections 73(5) and 74(5) of the Act of 2017 provide that voluntary payment of tax before issuance of show cause notice is permissible and the law does not bar the tax payer from voluntarily making payment of any tax liability ascertained by him or the Tax Officer in respect of such issues, either during the 5 course of such proceedings or subsequently. He further submits that the application for refund has been examined by the authorities and the same has been rejected on 27.06.2025 as the claim was initiated by him under Section 74(5) in proceedings under Section 71 of the Act of 2017, however, he fairly admits that till so far, no notice has been issued to the Petitioner-Firm either under Section 73 or 74 of the said Act. However, learned State Counsel has no objection if the amount so deposited is adjusted at the time of final adjudication. 5. Having heard learned Counsel for the parties and having considered the alternative prayer of the Petitioner, it is directed that the amount so deposited by the Petitioner-Firm, if found in excess, may be adjusted at the time of final adjudication or with the amount of dues, if any, in his favour. 6. It is further expected that whenever any inspection is carried out in terms of Section 71 of the Act of 2017, further course of action must be initiated by the concerned authorities in an expeditious manner in the spirit of Act of 2017. 7. With the above direction/observation, the instant Petition is
Arguments
: Shri Pranjal Agrawal, Advocate. For Respondents/State : Shri DR Minj, G.A along with Ms. Anuradha Jain, PL. Hon'ble Shri Justice Deepak Kumar Tiwari Order on Board 19.08.2025 1. This Petition has been filed under Article 226 of the Constitution of India claiming refund of excess deposit made by the Petitioner-Firm during the proceeding under Section 71 of the State Goods and Services Tax Act, 2017 (for short ‘the Act of 2017’) to the tune of Rs.10,91,539/45. 2. Summarized facts of the case are that the Additional Commissioner of State GST, Raipur, exercising powers under Section 71 of the Act of 2017, authorized the Officers of the GST. In turn, Petitioner-Firm at its premises was inspected on 19.03.2025. During the said inspection, panchnama was prepared and a show cause notice for cancellation of Registration dated 20.03.2025 was also issued to the Proprietor of the Firm at his registered address i.e. Shanti Nagar, Ring Road No.2, Gaurav Path, Bilaspur on the ground that registration has been obtained by means of fraud and willful misstatement or suppression of facts as “BOGES DEALER”. Statement of the Proprietor of the Petitioner- Firm was recorded on 21.03.2025 wherein, he has declared his tax 3 liability to the tune of Rs.1,08,461/- which remained unpaid and on the same day, under duress, he was coerced to deposit Rs.12 lacs, which he has deposited in cash through GST DRC-03. The authorities have, after considering the reply of the show cause notice dated 20.03.2025, passed an order for dropping the proceedings for cancellation of Registration with effect from 24.03.2025. The Petitioner-Firm has made a complaint to the Commissioner, GST Office, Raipur on 05.04.2025 stating that the amount has been deposited under duress and also filed an application for refund of the excess deposit but as the authority has not passed any order with regard to the same, therefore, the Petitioner transcended to file Writ Petition before this High Court on 08.06.2025. 3. Learned Counsel for the Petitioner submits that excess deposit which has been forced by the Officer of the GST Department during the course of search, inspection or investigation is in violation of “Instruction No.01/2022-23 [GST - Investigation] issued by Finance Ministry on 25.05.2022. He further submits that the amount so deposited, if found excessive, may be directed to be adjusted after the final adjudication and the same may be refunded to the Petitioner-Firm. 4. Learned State Counsel submits that various inputs have been received in the software of Central Board of Indirect Taxes 4 and Customs i.e. Business Intelligence and Fraud Analytics (BIFA) whereby, it was found that for the financial years 2017-2018 to 2024-25, the tax paid in cash for the financial years 2017-18 to 2022-23 is zero and for the financial year 2023-24, the tax paid in cash is Rs.76,000 and for the financial years 2024-25, it was Rs.96,000/- and such statics create a doubt of tax evasion on the part of the Petitioner-Firm. He further submits that there was a mismatch of the E-Way bill related information and the input tax, which has been passed on by the Petitioner-Firm received by various beneficiaries are Deepak Pandey, JR Construction Co., DC Construction, Vinayak Advertising, Universal Infra, Shanti Fertilizer, PIC Construction, Siddhi Vinayak Construction, Suresh Kumar Agrawal and Parshvnath Construction Co. and as there are top 10 beneficiaries to whom, the ITC was passed on and the risk score is
Decision
disposed of. Sd/- (Deepak Kumar Tiwari) JUDGE Priya