Order Date - 28 January 2025

Parties: Annai Angammal Arakkattalai Vs Joint Commissioner or GST (Appeals) and The Assistant Commissioner of GST & Central Excise

Facts – 

• The Petitioner, M/s. Annai Angammal Arakkattalai, a charitable trust running a marriage hall, registered under the CGST Act on 14.02.2020 consequent to an investigation conducted on 23.01.2020.
• Upon investigation, the department found that the petitioner collected rent from July 2017 to January 2020 without GST registration, and voluntarily paid GST liability and  penalty using the cum-tax basis method under Rule 35 of CGST Rules, 2017.

Issue –

•  Whether the petitioner is entitled to the benefit of cum-tax valuation under Rule 35 of CGST Rules?

Order – 

• The Single Bench of Hon’ble High Court observed that it should be seen that the petitioner had attempted to evade payment of tax which is liable to be taxed and only pursuant to the inspection effected by the respondent, the petitioner had submitted himself for payment of tax and hence, the same cannot be said to be a voluntary payment and has been made only to wriggle out of the penal consequences. 
• This conduct of the petitioner to evade tax will also fall under suppression and fraudulent activities envisaged under Section 74 of the GST Act. Hence, the contention that Section 74 cannot have been invoked against the petitioner cannot be countenanced.
• Writ Petition is dismissed and upheld the orders passed by the Original Authority and the Appellate Authority.