Case
Analysis: Ultra Tech Cement Ltd. vs. Union of India & Others
Application
No.: CWP NO. 2437 of 2020
Court:
High Court of Himachal Pradesh
Date: 13.06.2024
Background
The case Ultra Tech Cement Ltd. vs. Union of
India & Others was adjudicated in the High Court of Himachal Pradesh at
Shimla under CWP No. 2437 of 2020. The judgement was reserved on May 22, 2024,
and pronounced on June 13, 2024, by a bench comprising Hon’ble Mr. Justice M.S.
Ramachandra Rao, Chief Justice, and Hon’ble Mr. Justice Satyen Vaidya.
Petitioner’s
Submission
Ultra Tech Cement Ltd., the petitioner,
operates two manufacturing units in Himachal Pradesh, located at Village Baga
and Village Pandiyana (Bagheri). These units, along with a marketing office,
are registered under a single GSTIN. The case revolves around the petitioner’s
claim for budgetary support under the “Scheme of Budgetary Support” notified on
October 5, 2017, following the introduction of the GST regime on July 1, 2017.
1. Claim
for Budgetary Support:
·
The petitioner filed
an application seeking budgetary support for the period from July 1, 2017, to
September 30, 2017, amounting to Rs. 5,89,96,942.
·
They clarified that
the credit balance in the GST credit ledger pertained to their Baga unit, not
the Bagheri unit, which was eligible for the support.
2. Rejection
of Claims:
·
The Deputy
Commissioner, CGST, Boileauganj, Shimla, denied the benefit on the ground that
there was a credit balance in the credit ledger that could have been utilized
for tax payments.
·
The petitioner’s
appeal to the Commissioner (Appeals), CGST, Chandigarh, was dismissed without
consideration of the merits.
Respondent’s
Submission:
The respondents, represented by Mr. Balram
Sharma and Mr. Vijay Arora, maintained that:
·
The claims were denied
based on the credit balance in the GST credit ledger, arguing that the
petitioner could have used this credit for tax payments.
·
The appellate
authority contended that the scheme was a grant, not a refund, and thus not
subject to appellate jurisdiction.
Court’s
Findings:
The court, after examining the submissions,
found:
1. Non-consideration of Specific Contentions:
·
The Deputy
Commissioner failed to consider the petitioner’s specific contention that the
credit balance pertained to a non-eligible unit (Baga unit) and should be
ignored for the Bagheri unit’s budgetary support claim.
2. Natural Justice:
·
The court noted the
absence of a personal hearing and failure to provide reasons for rejecting the
claims for the third quarter (October to December 2017).
Judgement:
The court set aside the orders of the Deputy
Commissioner and the appellate authority, directing the Deputy Commissioner to
reconsider the petitioner’s claims for budgetary support for the periods:
1. July 1, 2017, to September 30, 2017.
2. October 1, 2017, to December 31, 2017.
The Deputy Commissioner was instructed to give
a personal hearing to the petitioner and pass orders in accordance with the law
within three months.
Summary:
The High Court of Himachal Pradesh ordered a
reconsideration of Ultra Tech Cement Ltd.’s claims for budgetary support,
highlighting the need for adherence to principles of natural justice and proper
consideration of the petitioner’s contentions regarding the credit balance’s
applicability. The case underscores the importance of procedural fairness in
administrative decisions under the GST regime.
