2025(07)LCX0321

Himachal Pradesh High Court

Bhawya Enterprises

Versus

Assistant Commissioner

CWPs No. 11694 of 2025 decided on 24-07-2025

New Page 1

IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA

CWPs No.11694, 11696 & 11697 of 2025
Date of Decision: 24.07.2025

1. CWP No.11694 of 2025

M/s Bhawya Enterprises                                        ….Petitioner

                                                  Versus

Assistant Commissioner, State Taxes
& Excise (GST/Allied Taxes) & another                 ...Respondents

2. CWP No.11696 of 2025

M/s Sohan Singh Meet Singh & Sons                   ….Petitioner

                                                 Versus

Assistant Commissioner, State Taxes
& Excise (GST/Allied Taxes) & another                ...Respondents

3. CWP No.11697 of 2025

M/s Jalam Singh Fauji Sons                               ….Petitioner

                                                  Versus

Assistant Commissioner, State Taxes
& Excise (GST/Allied Taxes) & another              ...Respondents

Coram
Hon’ble Mr. Justice Vivek Singh Thakur, Judge
Hon’ble Mr. Justice Sushil Kukreja, Judge

Whether approved for reporting?

For the petitioner(s) :  Mrs.Vibhooti Malhotra, Advocate (through
(in all petitions)          Video Conferencing), Mr. Vardaan
                                Malhotra & Mr. Atul G. Sood, Advocates

For the respondents :  Ms. Sharmila Patial, Additional Advocate
(in all petitions)           Genera, for respondent No.1/State.
                                 Ms. Reeta Thakur, Senior Panel Counsel
                                 and Ms. Aastha Kohli, Advocate, for
                                 respondent No.2.
                                 Shri Amar Nath Gautam, Assistant
                                 Commissioner, State Taxes & Excise
                                 (GST/Allied Taxes), Sataum Circle,
                                 Panota Sahib, District Sirmour, HP, is
                                 present in person.

Vivek Singh Thakur (Oral)

These petitions have been filed by the petitioners, being aggrieved by recovery of demanded CGST from the account of the petitioners before expiry of three months, causing prejudice to the right of the petitioners to assail the demand, raised by the Assistant Commissioner under Section 74 of CGST Act, by filing an appeal under Section 107 of CGST Act.

2. As already stated in the certificate issued by the Assistant Commissioner, placed on record as Annexure P-5 in all petitions, it is an admitted fact that demanded GST has been recovered by the Assistant Commissioner by mistake.

3. Considering the provisions of law and the material placed on record, we had passed following common order on previous date 22.07.2025:-

“Notice. Mr. Navlesh Verma, learned Additional Advocate General, appears, waives and accepts service of notice on behalf of respondent No.1/State and Ms. Aastha Kohli, learned counsel, on behalf of respondent No.2.

2. Main grievance of the petitioner in present petition is that after passing of final order dated 01.05.2025 (Annexure P-3) passed by respondent No.2 under Section 74 of CGST Act confirming the demand of GST and imposing penalty, petitioner was having three months’ time to deposit the same or file an appeal assailing the said order under Section 107 of CGST Act and further for non deposit of amount in compliance of order dated 01.05.2025, recovery on the basis of order could have also been made prior to expiry of three months, but for recording the reasons, but in present case, recovery has been effected by respondent No.1 within just five days, that too, without recording any reason, and the recovery so made is more than 10% of the liability fixed vide order dated 01.05.2025.

3. It is further case of petitioner that petitioner intends to file an appeal against order dated 01.05.2025, for which limitation period is three months, but for filing an appeal, it is precondition to deposit at-least 10% of the amount of tax determined payable in order dated 01.05.2025, despite recovery of more than 10% of demand raised, portal of the department available for filing appeal is not accepting the appeal for want of deposit of at-least 10% of the demand created, vide order dated 01.05.2025 and thus the petitioner is not able to file an appeal by referring the amount recovered as amount deposited at the time of filing of the appeal because the amount so recovered is being treated as admitted amount of tax deposited by or recovered from the petitioner instead of disputed amount.

4. It is further case of petitioner that on approaching, respondent No.1 has issued certificate dated 19.06.2025, dispatch No.709 (Annexure P-5), wherein he has admitted that amount in terms of order dated 01.05.2025 has been debited for the financial year 2018-19 and 2019-20 inadvertently, despite admitting mistake in debiting/recovering the amount, respondent No.1 has not reversed the same to the account of petitioner. Therefore, in aforesaid circumstances, petitioner is constrained to file present petition.

5. It has also been submitted by learned counsel for the petitioner that limitation to file appeal is going to expire on 31.07.2025.

6. In aforesaid circumstances, prima facie, case is made out to pass an interim order against the respondents. However, for request made by learned Additional Advocate General, matter is adjourned to enable him to have instructions.

7. Prayer of learned Additional Advocate General is accepted with caution that it is expected from the respondents to act in accordance with law and in case some mistake has been committed by an officer, appropriate steps must be taken for rectifying the mistake instead of litigating unnecessarily causing loss of time, energy and resources of the public, State and Courts, resulting in delay in adjudicating other matters of importance.

8. As in present case, officer concerned has himself admitted that amount has been debited inadvertently, therefore, for just and fair play, the amount should have been reversed to the account of the petitioner.

9. Without passing any positive direction at this stage, leaving it to the wisdom of concerned officer to decide next course of action, as prayed for by learned Additional Advocate General, matter is adjourned to enable him to have complete instructions in the matter by next date.

List for further orders on 24.07.2025.”

4. Today, Assistant Commissioner, present in person, has endorsed that recovery in reference was made by mistake. It is obvious that amount recovered by mistake has to be refunded/reversed to the account wherefrom it was recovered.

5. In view of above, we direct respondent No.1 to take necessary action for rectification of mistake and to refund/reverse the amount so recovered by mistake to the account wherefom it was recovered, alongwith interest as provided/permissible under the Statute. Needful be done on or before 26.07.2025.

6. We are not expressing any opinion with respect to the merit of the demand raised by the Assistant Commissioner, vide order dated 01.05.2025, and in case any appeal or other statutory remedy is filed/opted by the petitioners, then the demand in reference, definitely, shall be subject to final outcome of such proceedings. In absence of filing any appeal or availing statutory remedy, the Assistant Commissioner concerned shall be entitled to recover the amount as permissible under law.

7. As the grievance of the petitioners stands redressed and nothing survives to be adjudicated further and, accordingly, these petitions are disposed of with aforesaid direction.

Pending miscellaneous application(s), if any, shall stand disposed of.

(Vivek Singh Thakur)
Judge

(Sushil Kukreja)
Judge

July 24, 2025