Partly allowed

M/S. Dhariwal Products v. Union of India

Rajasthan HC12 Jul 2022CW/2189/2022

Case brief

AI extract

What is this about?

In a writ petition by a taxpayer challenging coercive recovery and summons, the High Court partially allowed the relief by directing that GST authorities continue enquiries under Section 74 within one year while strictly prohibiting any coercive steps or forced tax deposits against the petitioner.

What did the court decide?

Direction to cooperate in proceedings concluded within one year; prohibition on coercive steps and forced tax deposits.

M/S. Dhariwal Products Vs Union of India — GST and Indirect Tax | Rajasthan HC (2022)

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HIGH COURT OF JUDICATURE FOR RAJASTHAN AT JODHPUR

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D.B. Civil Writ Petition No. 2189/2022

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M/s. Dhariwal Products, E-106, B-1, Marudhar Industrial Area, Basni 2Nd Phase, Jodhpur Through Proprietor Nitin Dhariwal S/o Shri Sushil Dhariwal, Aged About 41 Years, Resident Of 6A-8/9, Navkar Society, Shastri Nagar, Jodhpur, Rajasthan 342003.

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----Petitioner

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Versus

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Union Of India, Through Revenue Secretary, Department Of Revenue, Ministry Of Finance, Government Of India, New Delhi 110001.

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Central Board Of Indirect Taxes And Customs, Department Of Revenue, Government Of India Through Commissioner, North Block, Central Secretariat, New Delhi, Delhi 110001.

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Directorate General Of Gst Intelligence (Dggi) Hqrs, Through Principal Director, 1St And 2Nd Floor, Wing Number 06, West Block, 08 Rk Puram, New Delhi, Delhi 110066.

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Directorate General Of Gst Intelligence (Dggi), Jaipur Zonal Unit, Jaipur, C-62, Sarojini Marg, Panch Batti, Ashok Nagar, Jaipur, Rajasthan 302001 Through Additional Director General.

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Senior Intelligence Officer, Dggi, Jaipur Zonal Unit, Jaipur, C-62, Sarojini Marg, Panch Batti, Ashok Nagar, Jaipur, Rajasthan 302001.

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----Respondents

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For Petitioner(s)	:	Mr. Vikas Balia, Sr. Advocate, with
		Mr. Sharad Kothari, Mr. Mayank Tripathi and Mr. Priyanshu Arora.
For Respondent(s)	:	Mr. Rajvendra Saraswat. Mr. Uttam Singh for
		Mr. Mukesh Rajpurohit, ASG

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HON'BLE MR. JUSTICE SANDEEP MEHTA HON'BLE MR. JUSTICE KULDEEP MATHUR

Order

(2 of 4)

[CW-2189/2022]

12/07/2022

The instant writ petition has been preferred by the petitioner M/s. Dhariwal Products for assailing the summons issued to the petitioner by the respondent GST authorities under Section 70 of the GST Act; alleged coerced recovery of rupees 11.5 crores during the course of search operations dated 05.01.202206.01.2022; to refund the said amount to the petitioner and to direct the respondents to undertake the remaining investigation/adjudication proceedings fairly and strictly in accordance with law with reference to Section 74 of the CGST Act, 2017.

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While entertaining the writ petition, this Court passed an interim order dated 09.02.2022 (i) restraining the respondents from taking coercive steps against the petitioner/ its representatives in furtherance of the search / seizure operations dated 05.01.2022 / 06.01.2022 and the summons issued in pursuance thereof; and (ii) that the petitioner shall not be forced to deposit any amount towards GST without adhering to the procedure provided under Section 74 of the CGST Act.

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The matter came up for orders on the Interlocutory Application No.01/2022 filed by the respondents under Article 226(3) of the Constitution of India for vacating the ad interim stay order dated 09.02.2022.

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With the consent of the learned counsel for the parties, final arguments were heard today itself.

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Learned Senior Counsel Shri Vikas Balia assisted by Shri Sharad Kothari, Advocate representing the petitioner and Shri Rajvendra Saraswat, counsel representing the respondent GST Department, submitted that rather than entering into the merits of

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(3 of 4) [CW-2189/2022]

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the controversy, the Department may be given liberty to continue with the proceedings of enquiry /assessment while adhering to the provisions of Section 74 and allied provisions of the CGST Act and while giving protection from coercive action to the petitioner / its representatives. A request was also made to permit conclusion of such exercise within a period of one year from the date of this order and to require the petitioner/ its representatives to cooperate in the enquiry/ investigation/ assessment proceedings.

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In view of the submissions made herein above, it is hereby directed that

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(I) that the petitioner and its representatives shall cooperate with the further course of action to be taken by the respondents GST Authorities pursuant to the search / seizure proceedings dated 05.01.2022/06.01.2022 which shall be continued strictly in accordance with the procedure laid down under Section 74 and allied provisions of the CGST Act.

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(II) The petitioner/ its representative shall cooperate in the proceedings and will appear before the enquiry officer/ investigating officer as and when directed. The enquiry/ investigation shall be undertaken and concluded within a period of one year from today subject to the condition that the petitioner and its representatives cooperate in the proceedings.

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(III) No coercive steps shall be taken against the petitioner/ its representatives and the petitioner shall not be forced to deposit any amount towards GST before conclusion of the proceedings as above.

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(4 of 4)

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[CW-2189/2022]

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The writ petition is disposed of in these terms. All pending applications are also disposed of.

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No order as to costs.

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(KULDEEP MATHUR),J

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(SANDEEP MEHTA),J

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27-Tikam/Prashant-

M/S. Dhariwal Products v. Union of India

Case brief

What is this about?

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M/S. Dhariwal Products v. Union of India

Case brief

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