Case Name: M/s. V.L.Traders
Appeal Number: GUJ/GAAR/R/49/2021
Date of Order: 27-08-2021
The applicant M/s. V. L. Traders approached Gujarat advance ruling authority for classification of papad of different sizes and shapes, and applicable rate on them. The applicant had declared that it has no proceedings pending with respect to subject questions raised in the application.
The Advance Ruling Authority ruled that DGGI had initiated the Summons proceedings under section 70(1) CGST Act against the applicant, prior to the subject GST-ARA 01 Application filed. And inquiry initiated under Section 70(1) of the CGST Act 2017 by the DGGI on the applicant is a judicial proceeding, because Section 70(2) of CGST Act, 2017 has deeming provision that, every such inquiry referred to in sub-section (1) shall be deemed to be a judicial proceeding within the meaning of section 193 and section 228 of the Indian Penal Code.
Thus, the applicant has contravened the provision of Section 98(2), CGST Act, in so much that it mis-declared that it had no proceedings pending under any provisions of the Act, with an intention to fraudulently obtain Ruling and frustrate the proceedings initiated by DGGI, for the Question raised in the subject Application and issue for which Investigation was initiated vide Section 70(1) of CGST Act, 2017 by DGGI are the same.
The words “any proceeding” in the proviso to Section 98(2) of the CGST Act encompass within its fold the investigation proceedings launched by the DGGI under Section 70 of CGST Act.
It further held that Advance Ruling cannot be used as a mechanism to nullify and frustrate the inquiry proceedings already initiated vide section 70(1) of CGST Act.
“ 12. The applicant should bear in mind that the CGST Act has deemed this Authority to be a civil court for the purposes of section 195, but not for the purposes of Chapter XXVI of the Code of Criminal Procedure, 1973, and every proceeding before the Authority shall be deemed to be judicial proceeding within the meaning of sections 193 and 228, and for the purpose of section 196 of the Indian Penal Code…”
The application was accordingly rejected as non-maintainable and inadmissible.
READ ORDER HERE: http://www.gstcouncil.gov.in/sites/default/files/AAR-Dynamic/Order_%20Final_49_2021_Vipul%20Laljibhai%20Dobariya%20%20(V%20L%20Traders)%20_16_2020.pdf
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