The Allahabad High Court, while setting aside an order passed under Section 73 of the GST Act, observed that order Section 73 of the Goods and Service Tax Act, 2017 could not be passed to a company which is under the Corporate Insolvency Resolution Process (CIRP) under the Insolvency and Bankruptcy Code, 2016.
Brief Facts:
The present petition was filed, challenging the order passed by the respondent authority under Section 73 of the GST Act.
Observations of the court:
The court observed that a show cause notice under Section 73 was issued to the petitioner on 10.04.2024. Petitioner, in its reply dated 12.04.2024, informed the authority that the petitioner was under CIRP and requested authority for time for seeking instructions from the Interim Resolution Professional.
Further, the court noted that no further opportunity of hearing was granted to the petitioner; the Court observed that the insolvency process was set aside by the National Company Law Appellate Tribunal, Chennai, on 15.04.2024. Further noting that the order of the NCLAT could not be communicated to the assessing authority in time, the court held that clearly, once the petitioner was undergoing resolution before the Interim Resolution Professional and the fact of IRP appointment was communicated to the adjudicating authority, it may not have passed the impugned order during the pendency of that CIRP. The umbrella of the Insolvency and Bankruptcy Code was lifted only on 15.04.2024.
The decision of the Court:
The court set aside the order passed under Section 73 and directed the petitioner to file a fresh reply to the show cause notice.
Case Title: M/S Bgr Energy Systems Ltd vs State of U.P. and Anr.
Coram: Hon’ble Mr Justice Saumitra Dayal Singh and Hon'ble Mr. Donadi Ramesh
Case No.: WRIT TAX No. - 1026 of 2024
Advocate for the Petitioner: Shubham Agrawal
Advocate for the Respondent: C.S.C
Read Judgment @LatestLaws.com
Picture Source :
