Facts of the Case

Arthinkal Village Service Co-operative Bank Ltd., represented by its Secretary Smt. Tintu C. Vincent, filed this writ petition before the High Court of Kerala at Ernakulam challenging a notice in Form GST ASMT-10 dated 01.07.2020 issued by the Assistant Commissioner, State Tax Office, for the year 2017-18, concerning disputed input tax credit, along with the consequent order (Reference No. ZJ3202220008541) dated 02.02.2022 and a subsequent recovery notice dated 18.05.2023 issued by the State Tax Officer (Arrear Recovery). The petitioner had earlier filed a reply dated 12.12.2020 to the ASMT-10 notice, supported by its purchase register evidencing the ITC availed, and had also relied on an order dated 11.11.2022 passed by the same High Court in an earlier writ petition, W.P.(C) 32054/2022. Respondents to the petition included the Assistant Commissioner (State Tax Office), the State Tax Officer (Arrear Recovery), the Commissioner of State GST, the State of Kerala, the Union of India and the CBIC. The matter came up for admission on 25.10.2023 and was heard and decided by a single judge the same day.

Issues Involved

  1. Whether the writ petition challenging the ASMT-10 assessment and the consequent recovery proceedings should be permitted to be withdrawn to enable the petitioner to avail the benefit of the GST Amnesty Scheme likely to be notified by the GST Council.
  2. Whether such withdrawal should be granted with liberty, so as to preserve the petitioner's position pending notification of the amnesty scheme, rather than being treated as a final adjudication on the ASMT-10 assessment.

Petitioner's Arguments

  • After arguing the matter for some time, counsel submitted that the petitioner wished to withdraw the writ petition in order to avail the benefit of the Amnesty Scheme likely to be notified by the GST Council.
  • By implication, the petitioner preferred availing the prospective amnesty relief over continuing to contest the ASMT-10 assessment and the recovery proceedings on merits in the pending writ, given the disputed input tax credit position reflected in its purchase register.
  • The petitioner did not press for any adjudication on the correctness of the ASMT-10 notice, the consequent order dated 02.02.2022, or the recovery notice dated 18.05.2023, choosing instead to keep its options open through the amnesty route.

Respondent's Arguments

  • No independent counter-submissions are recorded; the State did not oppose the petitioner's request to withdraw the petition.
  • The respondents, represented through the learned Government Pleader, did not press for the ASMT-10 assessment or the recovery proceedings to be affirmed on merits at this stage, since the petitioner's request was one of simple withdrawal.

Court Order/Findings

  • Considering the petitioner's submission and prayer to withdraw in order to avail the Amnesty Scheme, the Court permitted the withdrawal.
  • The writ petition was dismissed as withdrawn, with liberty to the petitioner to avail the Amnesty Scheme once notified.
  • Any interlocutory application pending in the writ petition was also dismissed as a consequence.
  • The order records no independent finding on the merits of the ASMT-10 notice, the assessment order, or the recovery notice, leaving the underlying tax dispute untouched by this disposal.

Important Clarification

  • Taxpayers facing recovery proceedings arising from ITC-related ASMT-10 assessments can choose to withdraw a pending writ challenge in order to instead avail a GST Amnesty Scheme once notified, without an adverse finding being recorded on the merits.
  • Withdrawal 'with liberty' leaves the underlying assessment and recovery notice undisturbed — the taxpayer must independently satisfy the conditions of the amnesty scheme, once notified, to actually obtain relief from the disputed demand.
  • The Court expressed no opinion on the correctness of the ASMT-10 assessment or the recovery notice; the disposal was purely at the petitioner's own instance, and the underlying GSTR-2A/purchase-register dispute remains open.
  • Registered persons weighing whether to litigate an ITC mismatch or wait for an amnesty scheme should note that withdrawal here did not foreclose future recourse — it simply deferred the dispute pending the scheme's notification.

Sections Involved

  • Section 61, CGST Act, 2017 – scrutiny of returns, under which the Form GST ASMT-10 notice is issued.
  • Section 79, CGST Act, 2017 – recovery of tax, the basis for the arrear recovery notice challenged.
  • Article 226, Constitution of India – writ jurisdiction invoked before withdrawal.

Decision – In Favour of

Disposed of as withdrawn at the petitioner's own request; no finding was made in favour of either side on merits, though the liberty granted to avail the Amnesty Scheme practically benefits the Assessee going forward.

Related Case Laws

No directly on-point case notes are currently published on this site.

Case Details

  • Court: High Court of Kerala at Ernakulam
  • Case No.: WP(C) No.21879 of 2023
  • CNR: Not available on record
  • Coram: Hon'ble Mr. Justice Dinesh Kumar Singh
  • Decision Date: 25.10.2023
  • Disposal Nature: Dismissed as withdrawn to avail GST Amnesty Scheme

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