Page 149 - GSTL_18th June 2020_Vol 37_Part 3

2020 ] IN RE : OMSAI PROFESSIONAL DETECTIVE AND SECURITY SERVICES PVT. LTD. 363
(2) As stated in the background facts, and as an elaboration to the same,
the appellant would like to explain the practical difficulty faced at
the time of committing default of non-filing of return, which had oc-
curred purely as a result of helplessness and was undoubtedly
without any malicious intention of evading taxes.
(3) Appellant submits that the main reason for delayed/Non-payment
of GST is due to huge delay in the realisation of the amounts due
from the clients. The ideal average time taken for the realisation is 90
days from the date of raising the invoice. Whereas, the appellant has
to pay the salaries to the security personnel on monthly basis and
certain clients allow raising invoice only after the payment of sala-
ries to them. The interest/finance cost on the overheads (mainly sal-
aries to the security personnel) is almost shelling out the margins of
the appellant. Adding to the above difficulties, the GST at the rate of
18% has to be paid immediately on raising of the invoice which is
becoming an added burden to the appellant. All these led to huge
working capital crisis, ultimately leading to cash crunch in the
hands of the appellant. Further, the main reason of bringing the se-
curity services under reverse charge (w.e.f. 1-1-2019) is relieve the
suppliers of ‘security services’ from the above mentioned difficul-
ties. Further, the bank accounts were frozen which had further add-
ed to the difficulties of the appellant in remitting the salaries to the
security personnel affecting the livelihood of the 20,000 employees
of the appellant.
(4) Though the client was facing cash crunch, it prioritized the revenue
of the government over business needs and started depositing cash
into the electronic cash ledger as and when the collections were
made from the debtors. The same can be evidenced from the Elec-
tronic cash ledger which is enclosed herewith as Annexure ---
(5) Therefore, the alleged delayed payment of GST is arisen mainly be-
cause of huge cash crunch, and as soon as even a part of receivables
were being realized, efforts were being made to accumulate the
same in the electronic cash ledger until accumulated amount was
enough to offset the liability for the respective month.
(6) Without prejudice to the above, Appellant submits that the im-
pugned orders raised the demand under section 62 of CGST Act,
2017, which read as under :
“62.(1) Notwithstanding anything to the contrary contained in
section 73 or section 74, where a registered person fails to fur-
nish the return under section 39 or section 45, even after the ser-
vice of notice under section 46, the proper officer may proceed
to assess the tax liability of the said person to the best of his
judgement taking into account all the relevant material which is
available or which he has gathered and issue an assessment or-
der within a period of five years from the date specified under
section 44 for furnishing of the annual return for the financial
year to which the tax not paid relates.”
(7) As seen from the above, the proper officer may assess the tax liabil-
ity only inter alia if the
(a) Registered person failed to furnish the returns under section
39 of CGST Act, 2017.
GST LAW TIMES  18th June 2020  149