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Insistence on manual payments discouraged by High Court

Case of Pioneer Polyleathers Ltd Vs Assistant State Tax Officer dated 16.11.2018

Facts

Goods belonging to the Petitioner, a registered dealer, were detained u/s 129(3) and tax demanded of Rs.5,28,834/-. Petitioner paid the amount through the portal and obtained payment receipt but the State Tax officer refused to release the goods and he insists that the tax and penalty ought to have been paid through cash or demand draft. Therefore, the present petition is filed. Counsel for Revenue submitted that the amount must be apportioned between the Centre and state as the liability is under the head IGST. That it is not within the State's purview to effect the apportionment and that if the Court could have before it the GST Network, the problem would be solved. Counsel for GST Network submitted that they are only an infrastructure provider and have no statutory role to play in apportionment of taxes between Centre and State.

Decision of the High Court

The Court observed that Government both at the Centre and in the State, have ushered in the GST Tax regime to ensure that everything is made online with minimum manual interventions. Yet strangely, the authorities still insist that the payment should be by physical means i.e. either in cash or through Demand Draft. Such insistence seems to be archaic and out of tune with the very spirit of the GST regime. In apportionment, there may be delays and difficulties, but the taxpayer cannot be made to suffer, on that count - applying the ratio of the judgment in Fashion Marbles and Granites Pvt. Ltd. 2018-TIOL-62-HC-KERALA-GST, the Assistant State Tax Officer is directed to release the goods and the vehicle forthwith.

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