Order Date – 09 November 2023

Parties: Tikona Infinet Private Limited Vs The State of Andhra Pradesh

Facts –

• The Petitioner, Tikona Infinet Private Limited (TIPL), entered into a Business Transfer Agreement (BTA), dated 17.08.2017 with Tikona Digital Networks (TDN). 
• TDN intended to transfer unutilized credit in the electronic credit ledger of TDN on the date of slump sale to TIPL, but Form ITC-02 was not available on GSTN portal, and consequently, TDN was not able to transfer on GSTN portal and TIPL was unable to utilize the credit balance appearing in the electronic credit ledger of TDN. Thus, the petitioner/TIPL also submitted letter dated 12.02.2018 to the jurisdictional authority duly intimating about the transfer of ITC to TDN manually.
• A show cause notice was issued on the ground that the petitioner is claiming ITC in contravention of the provisions of Section 16 of the APGST Act 2017, also granting opportunity to file objections along with documentary evidence, as also providing personal hearing, if so desired.
• The petitioner without availing such opportunity filed the writ petition.

Issue –

• Whether the petitioner can challenge the show cause notice without responding the same?

Order –

• The Divisional Bench of Hon’ble High Court observed that the petitioner should respond to the show cause notice raising all such objections, as may be raised before the authority issuing the show cause notice and in case any adverse order is passed and the petitioner feels aggrieved, the petitioner may then have recourse to the appropriate proceedings.
• In the present case, the petitioner has not been deprived from availing the input tax credit as of now, but the show cause notice has been issued granting opportunity. So, at this stage, it cannot be said that as a consequence of not submitting Form GST ITC-02 electronically, the petitioner has been deprived of the claim of input tax credit. The petitioner has the opportunity and on such opportunity on verification of such fact, the authority has yet to consider the petitioner’s claim of input tax credit.
• Thus, the court held that the petitioner should approach the authority which has issued the show cause notice and file the objections with evidence, and if so desire, to avail the opportunity of personal hearing with due intimation to the authority concerned. 
• The Writ Petition is dismissed.