ORDER
(Order Under section 73 (9) of CGST/MGST Act 2017. r. w. U/s 20 of IGST ACT 2017) (See Rule 142 of CGST/MGST Rules 2017))
To,
Trade Name: TAXPAYER PARTY Legal Name: TAXPAYER PARTY GSTIN:
ADDRESS: TAXPAYER PARTY BUSINESS REGISTER ADDRESS
Period:- 01/04/2019 to 31/03/2020 F.Y:- 2019-20
No.: Mumbai west 895/Return Scrutiny/DRC-07 19-20/2023-24/B-987,Mumbai, Dt: 14/08/2023
- Brief facts of the case: Following discrepancies were communicated to the taxpayer in Form GST-ASMT-10, DRC-01A, DRC-1.
- Parameter 0074: In-eligible ITC claimed from RC is cancelled suppliers.
B) Chronology of events:
M/s. TAXPAYER PARTY, (Here in after referred to as “the taxpayer”), holder of GSTIN- ____________________ is registered taxpayer under the Goods and Service Tax Act 2017. The Place of business of the taxpayer is – Taxpayer Party Business Register Address The GSTIN- ______________________ is active wef 01/07/2017.
M/s. TAXPAYER PARTY holding GSTIN: _______________ has filed GST returns for the period 01/04/2019 to 31/03/2020 in Form GSTR-3B and GSTR-1.
During the proceedings of Scrutiny of Returns was initiated in taxpayers case, for the F.Y. 2019-20, discrepancies found were communicated to a taxpayer in form GST-ASMT-10 as referred at Reference No.3 and the taxpayer was asked to furnish a reply within 30 days after the receipt of the notice. Accordingly, as per reference no. 4, you have replied on the online portal in Form ASMT-11 dated 28/01/2023, 22/03/2023 & 31/03/2023 along with a letter of Reply & related documents. The submission and reply submitted by the taxpayer in form ASMT-11 is not proper & acceptable. A taxpayer has not submitted any document or proof in support of his ITC claim from M/s. Service Providing Party having GST No. _______________. Hence, the case was recommended for adjudication under section 73 of the MGST Act, 2017.
Intimation in FORM GST DRC 01A as referred at Ref. No.5 was also issued and this office had advised to taxpayer to pay the amount of tax as ascertained along with the amount of applicable interest within 30 days after the receipt of the Intimation in FORM GST DRC 01A and/or in case the taxpayer wish to file any submissions against the ascertainment, the same may be furnished within 30 days after the receipt of the Intimation in FORM GST DRC 01A in Part-B of DRC 01A i.e. Reply to the communication for payment before issue of Show Cause Notice. Accordingly, as per reference no 6, you have replied on the online portal in form GST DRC 01A –Part B dated 05/07/2023. The submission and reply submitted by taxpayer in form GST DRC 01A –Part B is not proper & acceptable. Taxpayer has not submitted any document or proof in support of his ITC claim from M/s. Service Providing Party having GST No. ________________________ along with form GST DRC 01A –Part B.
Thereafter, the show-cause notice under section 73(1) in FORM GST DRC– 01 was issued as referred at Reference No. 7 and directed to show cause within 30 days of receipt of this notice, as to why; tax amount alongwith applicable interest and penaly may not be recovered from
taxpayer under section 73 of the CGST Act, 2017. After that as per reference no. 8, a taxpayer has replied in form GST DRC 06, in which he has stated that “Taxpayer has purchased from supplier, M/s. Service Providing Party having GST No. ________________________. He has paid the tax amount to supplier and the supplier has shown outward supply in GSTR 1 Return also—latter GSTIN of M/s. Service Providing Party has been canceled because of unaware reasons. Now supplier, M/s. Service Providing Party has went in high court & filed an appeal against the cancellation of GST no. Hence, we would like to inform you that since the dealer has made appeal to the high court to get justify his matter.”
As reply submitted by the taxpayer in DRC 06 is not proper, hence this office has issued a reminder & the taxpayer has been given an additional opportunity of a personal hearing. But, a taxpayer has not paid tax liability along with applicable interest and penalty till date. Also Nobody attended nor produced/filed any document or proof in support of his ITC claim from M/s. Service Providing Party having GST No. ________________________ as per section 16(2) of GST act, 2017 against said notice & reminder after giving proper opportunity of being heard. Since no payment has been made within 30 days of the issue of the notice by the taxpayer; therefore, based on documents available with the department and information furnished by the taxpayer, if any, demand is created for the reasons and other details is as under.
At the outset, we would like to make it clear that the provisions of both the CGST Act and the MGST Act are the same except for certain provisions. Therefore, unless a mention is specifically made to such dissimilar provisions, a reference to the CGST act also mean a reference to the same provisions under the MGST ACT, further to the earlier, henceforth for the purpose of this proceedings, GST Act would mean CGST Act and MGST Act.
C) Details of discrepancies found along with Tax, Applicable Interest & Penalties:
- PARAMETER-0074 – In-eligible ITC claimed from RC is cancelled suppliers:
Your GSTIN is appearing in the GSTR-1 of the following supplier, who have only filed GSTR1 for this period but his registration certificate found cancelled for this period. Hence, you may not be eligible to avail the ITC on the invoices shown by this supplier as per the provisions of section 16 (2) (C) of the GST Act-2017.
Details of such suppliers is given below table.
| GSTIN/TIN | ____________________ |
| REGN_NAME | TAXPAYER PARTY |
| FIN_YEAR | 2019-20 |
| PARA6_ITC_RC_CANCELLED | 755328 |
| GSTIN_NGTP_RCC_NF | ________________________ |
| REG_NAME_NGTP_RCC_NF | SERVICE PROVIDING PARTY |
| TRADE_NAME_NGTP_RCC_NF | SERVICE PROVIDING PARTY |
| TAXABLE_VALUE | 2697600 |
| IGST | 0 |
| CGST | 377664 |
| SGST | 377664 |
| CESS | 0 |
| TOTAL_TAX | 755328 |
| SUPPLIER_CANCELLATION_DATE | 27/02/2019 |
| FLAG | RCC |
For the period 2019-20 In-eligible ITC claimed from RC is cancelled suppliers, SERVICE PROVIDING PARTY having GSTIN ________________________ is at Rs.755328/- i.e. CGST
Rs.377664/- and SGST Rs.377664/- which is to be recoverable from the taxpayer along with applicable interest and penalty under Section 73 of MGST/ CGST Act, 2017. The details of total tax liability uder parameter 74 is as under:
| Para No. | Objection in brief | Act | Tax | Interest | Penalty | Total | |
| In-eligible ITC | IGST | 0 | 0 | 0 | 0 | ||
| claimed from RC is | CGST | 377664 | 350724 | 37766 | 766154 | ||
| 74 | cancelled suppliers | ||||||
| SGST | 377664 | 350724 | 37766 | 766154 | |||
| (Amt. In Rs.) | |||||||
| Cess | 0 | 0 | 0 | 0 | |||
| Total | 755328 | 701448 | 75533 | 1532309 |
Contravention of the Law and Provisions: Contravened the provisions of Section 16(2), 73, 50 & 122 of MGST/CGST Act 2017.
In this case taxpayer has submitted his reply in DRC 06, which is not proper & acceptable. The taxpayer has not submitted any document or proof in support of his ITC claim from M/s. Service Providing Party having GST No. ________________________ as per section 16(2) of GST act, 2017, in response to the notices & intimations issued as referred above as well as he has not attended this office after giving a proper opportunity of being heard. Hence it is concluded that the taxpayer has nothing to say in this matter & taxpayer is liable for penalty u/s 73(9) and u/s 122(2).
ORDER
In view of the above facts and circumstances, the issue communicated has not been substantiated by the Taxpayer. Hence Tax levied under section 73 (9) of CGST/MGST Act 2017 and r. w. U/s 20 of IGST ACT 2017, Interest is levied under section 50 of CGST/MGST Act & penalty attracted under section 122(2a) and 73(9) of CGST/MGST Act is as under:
| Total Tax Liability (Amt. In Rs.) | |||||
| Description/ Tax Period | Act | Tax | Interest under section 50 (3) | Penalty under section 122 (2a) /73(9) | Total payable |
| 01/04/2019 To 31/03/2020 | IGST | 0 | 0 | 0 | 0 |
| CGST | 377664 | 350724 | 37766 | 766154 | |
| SGST | 377664 | 350724 | 37766 | 766154 | |
| CESS | 0 | 0 | 0 | 0 | |
| Total | 755328 | 701448 | 75533 | 1532309 | |
Please note that interest, if any, has been levied up to the date of issue of the order. While making payment, interest for the intervening period between date of order and date of payment, should also be worked out and paid along with the dues stated in the order.
Taxpayers are hereby directed to make the payment by 12/11/2023 failing which proceedings shall be initiated against you to recover the outstanding dues.
If you do not pay the amount, within the stipulated time, the same shall be recoverable as an arrears as per under sections 78 and 79 of the MGST Act, 2017.
(Any person deeming himself aggrieved by this Order may appeal against this Order to the Dy. Commissioner of State Tax (Desk ID CST-_____) Appellate Authority Address- _____________________________, Mumbai- __, within 3 months from the date of communication of this order.
The Appeal should be filed in FORM GST APL-01, through the Common Portal. The appeal shall be accompanied by a copy of the order appealed against, digitally signed by the appellant. All supporting documents should be uploaded on the common portal while filing the appeal.
Details of the case and the grounds, etc., if not possible to describe in the appeal to be filed online, may be prepared separately and uploaded at the time of filing of the appeal.
The appeal against this order shall lie before the Appellate Authority on payment of the prescribed fee and other charges, if any, under the provisions of Section 107 (6) of the IGST/CGST/SGST/UTGST Acts. The payment shall be made through the common portal at the time of filing the appeal.
Read:
- Your ITC claim in GSTR3B and which is credited into “Electronic Credit Ledger” maintained in form GST PMT -02 on common portal.
- GST Returns filed under CGST/MGST Act 2017.
- Notice for intimating discrepancies in the return after scrutiny u/s 61 of the CGST/SGST Act, 2017 issued in FORM-GST-ASMT 10 vide Reference No. __________ dated 30/12/2022
- Compliance made by taxpayer i.e. reply to notice issued under section 61 intimating discrepancies in the return in form GST ASMT 11 dated 28/01/2023, 22/03/2023 & 31/03/2023
- Intimation of tax ascertained as being payable under section 73(5) in FORM GST DRC- 01A vide Reference No. STO- MUMBAI WAST-895/GST/2019-20 DRC1A/2023-24
/B-987 DT: 30/06/2023 and ARN Reference No ____________ Dated 30/06/2023.
- Compliance made by taxpayer i.e. reply to the communication for payment before issue of the show cause notice in form GST DRC 01A –Part B dated 05/07/2023
- Notice in form GST-DRC-01- Show cause Notice issued under section 73(1) vide Reference No. MUMBAI WEST-895/2019-20 DRC-01/2023-24/ B-487, Mumbai Date: 13/07/2023 and ARN Reference No _______________ Dated 13/07/2023
- Compliance made by taxpayer i.e. Reply to the Show Cause Notice in form Form GST DRC-06 dated 19/07/2023
- Reminder for personal hearing is issued on date 21/07/2023.
Annexure to FORM GST APL-01
- Appeal to Appellate Authority
9. Details of the case under dispute –
- Brief issue of the case under dispute –Input tax credit (ITC) Dis allowed because of GST Number cancelled of the party from whom the material purchased. Supplier has filed the return GSTR-01 and GSTR-3B.
- Description and classification of goods/ services in dispute- Civil Construction
- Market value of seized goods –26,97,000/-
- Whether the appellant wishes to be heard in person – Yes
- Statement of facts-
We had purchased the material from SERVICE PROVIDING PARTY having GST number ________________. We have paid all the dues and GST to the supplier in a timely manners and the supplier had filed the return GSTR-01 and 3B timely manner. After filling return GST Number has been cancelled of supplier.
- Grounds of appeal –
Since we have paid all the taxes and principal amount to the supplier in timely manner. Because of the cancellation of GST Number of supplier ITC is disallowed to us.
- Prayer – kindly allow us ITC since we have paid all the taxes to the supplier.
- Whether the appeal is being filed after the prescribed period -No
- If ‘Yes’ in item 16–
(a) Period of delay –
(b) Reasons for delay –
