GST: Non-disclosure of Additional place of business on RC just a technical breach; Goods cannot be detained for that

The High Court of Delhi in the matter of GULMUHAR SILK PVT LTD vs. INCOME TAX OFFICER ruled out that Non-disclosure of Additional place of business on RC just a technical breach; Goods cannot be detained for that.

The Petitioner filed the writ petition challenging the order dated 28th March, 2022 passed by Respondent under Section 148A(d) of the Income Tax Act, 1961 [‘the Act’] for the assessment year 2018-19, Show Cause Notice dated 7th March, 2022 issued under Section 148A(b) of the Act as well as notice dated 28th March, 2022 purportedly issued under Section 148 of the Act.

The petitioner claims that the impugned judgement dated March 28, 2022 is a non-speaking order that ignores the Petitioner’s arguments in response to the impugned Show Cause Notice of March 7, 2022.

He states that the information mentioned in the Show Cause Notice pertains to the Assessment Year 2014-15 which has been used to frame reason to believe escapement of income for the Assessment year 2018-19.

The Coram Found out that, “A perusal of the paper book reveals that in the impugned order dated 28th March, 2022, the respondent has opined that the petitioner-assessee has not been able to rebut the statement made on oath by the entry provider. It is also stated that the DGGI, Ghaziabad had conducted a search and seizure action in this case under CGST Act, 2017 at Shop No.10, Aman Banquet, Sector-5, Rajendra Nagar, Sahibabad, Ghaziabad on 18th and 19th April, 2018 and had reached the same conclusion. Consequently, this Court is of the view that the impugned order is a speaking and reasoned order.

The assessee has only submitted bank statements and not the books of accounts before the Assessing Officer.

Though it is the petitioner’s case that the impugned order is erroneous on facts, yet this Court is of the opinion that the petitioner would have ample opportunity during the course of proceedings before different statutory forums to show that the finding of fact arrived at was erroneous. Moreover, at this stage, no assessment order has been passed and it has only been observed that it is a fit case for issuance of notice under Section 148 of the Act.In fact, the Supreme Court in Commissioner of Income Tax and Ors. Vs. Chhabil Das Agarwal, (2014) 1 SCC 603 has held that as the Income Tax Act, 1961 provides complete machinery for assessment/reassessment of tax, assessee is not permitted to abandon that machinery and invoke jurisdiction of High Court under Article 226. Consequently, the present case does not fall under the exceptional grounds on which a writ petition is maintainable at the interim stage in tax matters.”

The High Court ruled out that, “Accordingly, the present writ petition along with pending application stands dismissed with liberty to the petitioner to raise all its grounds before the Assessing Officer and the subordinate forums.”

The Judgment was made by MR. JUSTICE MANMOHAN and MR. JUSTICE DINESH KUMAR SHARMA.

The Petitioner was represented Mr.Kapil Goel and Respondent was represented Ms.Vibhooti Malhotra.

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