11 May GST Update: Right to Cross Examination Explained
Introduction
A recent case before the Calcutta High Court has shed light on a crucial aspect of the GST process. The denial of the right to cross-examination in GST proceedings has been challenged, marking a significant development in the landscape of Goods and Services Tax in India.
Facts of the Case
The case, titled Roshan Sharma vs The Assistant Commissioner of Revenue, State Tax, West Bengal, involved an adjudication order confirming the levy of tax, interest, and penalty, alongside the blocking of the credit ledger. The central point of contention was the denial of an effective opportunity for cross-examination of the supplier and transporter, whose statements were relied upon by the authority.
Issue
The primary issue at hand was the denial of the appellant’s right to cross-examine the supplier and transporter, thus limiting their ability to rebut the allegations against them effectively. This raised concerns regarding procedural fairness and the adherence to principles of natural justice in GST proceedings.
Held
The Calcutta High Court directed the adjudicating authority to provide copies of the statements obtained from the supplier and transporter to the appellant. Furthermore, the appellant was entitled to submit additional explanations and necessary documents. If requested, the appellant should be permitted to cross-examine the concerned individuals. Additionally, the court emphasized that the appellant bears the burden of proving the movement of goods with proper evidence. Notably, the blocking of the credit ledger would not prejudice the appellant if there was a negative balance. However, if funds were to flow into the ledger, the blocking would be restricted to the demand amount only.
Conclusion
The ruling in Roshan Sharma vs The Assistant Commissioner of Revenue, State Tax, West Bengal signifies a significant milestone in GST proceedings. It reinforces the right to cross-examination, promotes transparency in proceedings, clarifies the burden of proof on appellants, and provides guidelines for the blocking of credit ledgers. This decision has far-reaching implications for GST practitioners and businesses alike, ensuring fairness and compliance with GST laws.
No Comments