Ahmedabad: Gujarat High Court has quashed a GST show-cause notice issued to Naroda Enviro Projects Ltd and an honorary office-bearer, Shailesh Patwari, holding that the tax department wrongly invoked Section 74 of the CGST/GGST Acts and ignored an applicable exemption for charitable activities.
The petitions challenged the 2023 notice proposing tax, interest and penalty for the period from July 1, 2017 to May 12, 2022 on effluent treatment services, classifying them under SAC 9994 and alleging wilful suppression and intent to evade tax. It further found no material to establish fraud, wilful misstatement or suppression necessary for Section 74, citing Supreme Court precedent that mere non-payment does not amount to suppression without a positive act. You Can Also Check: Gold Rate in Ahmedabad | Silver Rate in Ahmedabad | Bank Holidays in Ahmedabad | Public Holidays in Ahmedabad | Ahmedabad AQI | Weather in Ahmedabad | Petrol Price in Ahmedabad | Diesel Price in Ahmedabad | CNG Price in Ahmedabad | LPG Price in Ahmedabad Stay updated with the latest Ahmedabad news.
The department relied on Notification 11/2017 prescribing 9% GST on “sewage and waste collection, treatment and disposal” services. HC noted that Naroda Enviro is registered under Section 12AA of Income Tax Act and that a 2019 HC judgement had conclusively held its dominant object to be “preservation of environment”, qualifying as charitable activity. Reading that finding with Notification 12/2017, which grants Nil GST to services by Section 12AA-registered entities “by way of charitable activities” including “preservation of environment”, the bench held the exemption applied.
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