Amit Agency vs Commissioner, Cgst And Cx

Headnote AI-drafted · Reviewed and approved

The petitioner, a partnership firm engaged in the business of cigarettes and registered under CGST and CX, challenged an audit report dated 18.07.2023 issued under Section 65(6) of the Bihar Goods and Services Tax Act, 2017, on the ground that it was issued after the expiry of the three-month limitation period prescribed under Section 65(4) of the Act. The petitioner further challenged a show cause notice dated 30.08.2023 issued under Section 74 of the Act on the basis of the allegedly time-barred audit report, contending that the mandatory pre-conditions for invoking Section 74 were not fulfilled, that the notice was not uploaded on the web portal contrary to CBIC instructions, and that it lacked a digital signature as mandated under Rule 26(3) of the CGST Rules, 2017.

The petitioner also assailed the order-in-original dated 22.04.2024 passed under Section 74 of the Act for the periods 2017-18, 2018-19 and 2019-20, a corrigendum dated 27.08.2024 issued under Section 161 of the Act seeking to impose penalty in excess of powers, and a separate order dated 18.10.2024 passed under Section 74 for the period 2017-18. The petitioner relied upon instructions issued by the Central Board of Indirect Taxes and Customs and judgments of the Supreme Court to argue that Section 74(1) of the CGST Act can be invoked only where fraud, willful misstatement or suppression of facts to evade tax is established, and not merely on account of non-payment of GST.

The Court examined the statutory framework under the CGST Act and BGST Act, 2017, the procedural requirements under the CGST Rules, 2017, and the CBIC instructions relating to audit and demand proceedings under Section 74, with particular reference to the conditions precedent for invoking the extended period of limitation and the requirement of digital signatures and portal-based communication.

Catchwords: GST audit · Section 65 BGST Act · audit report · limitation period · Section 74 CGST Act · show cause notice · fraud · willful misstatement · suppression of facts · digital signature · Rule 26(3) CGST Rules · Rule 142 CGST Rules · CBIC instructions · order-in-original · corrigendum · Section 161 · pre-conditions · web portal · demand proceedings