Calcutta HC in the case of Nowrangroy Agro Private Limited Versus Union of India

Case Covered:

Nowrangroy Agro Private Limited

Versus

Union of India

Facts of the Case:

This matter was taken up on 13th January 2021 and adjourned after hearing the parties enable the learned advocate representing the respondent nos.3, 7, and 10 to take instruction as to the basic documents required by the Inquiry Officer, who is holding an inquiry under Section 70 of the Central Goods and Services Tax Act, 2017 (hereinafter referred to as the CGST Act) apart from those documents which have been called for by the summons dated 7th December 2020 and 7th January 2021. The advocate for the respondent nos.3, 7, and 10 submit that the Inquiry Officer for the time being requires the documents mentioned in the summons dated 7th January 2021 but may require further documents on scrutinizing those documents.

On a perusal of the summons dated 7th December 2020 it will appear that Abhay Ajitsaria was summoned on 16th December 2020 to give evidence and tender his statement as also to provide documents and information as detailed in Annexure – ‘A’ to the said summons dated 7th December 2020. From the summons dated 7th January 2021, it appears that Beharilal Ajitsaria, Arun Kr. Ajitsaria and Anant Bajaj have been called to give evidence and/or produce documents or things as in Annexure –‘A’ to the said summons. It is, therefore, not clear as to why the three persons are directed to be present at a time before the Inquiry Officer at Delhi on 29th January 2021 apart from producing the documents amidst the pandemic when the inquiry is at a nascent stage.

Observations:

Considering this nature of dispute an inquiry proceedings is conducted by the CGST Authorities by issuing a summons under Section 70 of the 2017 Act. It appears that in the inquiry the classification of the transaction has to be first ascertained. In order to ascertain this the documents and records of petitioner no.1 is required initially. The corroborating evidence or statement from the officers of petitioner no.1 is then required. After ascertaining the rate of the tax applicable in terms of the classification, the quantum has to be ascertained on the basis of the value of the transaction undertaken. For this, the books of petitioner no.1 are required initially, and after scrutiny if any discrepancies are found the corroborative statements and evidence is required. CGST Authorities have already issued two summons, one dated 7th December 2020, and the other dated 7th January 2021. In Annexure –‘A’ to the summons dated 7th December 2020 a list of documents required to be produced by the petitioners on 16th December 2020 is mentioned. Pursuant to the summons issued on 7th December 2020, the petitioners have produced certain documents. The list in Annexure -‘ A’ to the summons dated 7th January 2021 speaks of 8 further documents required to be produced on 29th January 2021. The appearance and production of documents on 16th December 2020 go on to show that the petitioners have participated in the enquiry and have cooperated with the officers holding such inquiry up till now.

The Decision of the Court:

After the Inquiry Officer is through with the documents, he will call the person or persons from petitioner no.1 for the recording of statement or evidence as the case may be.

This modification to the procedure is made owing to the present pandemic situation when a person or persons should not be called to be present before the Inquiry Officer at New Delhi within very short span of time and presence of more than one person at a time should also be avoided.

Let the writ petition be adjourned till March 15, 2021 with liberty to the parties to mention in case of any difficulty.

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