Page 210 - GSTL_2nd July 2020 _Vol 38_Part 1

128 GST LAW TIMES [ Vol. 38
13. The fundamental objection of it against the orders is that the non-
filing of the returns in Form GSTR-3B is actually due to the financial crunch and
inability to discharge the tax liability by it, and no suppression of outward sup-
plies of services is involved. The appellant further explained that the main reason
for the delayed/Non-payment of the admitted GST is due to huge delay in the
realisation of the proceeds of its supply of services due from the clients. The ideal
average time taken for the realisation is 90 days from the date of raising the in-
voice, 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
salaries to them. The interest/finance cost on the overheads (mainly salaries to
the security personnel) is almost shelling out the margins of it. Adding to the
above difficulties, the GST at the rate of 18% has to be paid immediately on rais-
ing of the invoices, which is becoming an added burden to it. All these led to
huge working capital crisis, ultimately leading to cash crunch in its hands.
14. The appellant further put forth that in spite of the above stated cash
crunch, it has always prioritized the discharging the tax liability over business
needs and frequently deposited cash in to its electronic cash ledger as and when
the consideration is received from its recipients. Detailing about the above cir-
cumstances, the appellant strongly contended that there is no reason except cash
crunch for its failure to file the returns in Form GSTR-3B. Hence, argued that
holding/alleging suppression of tax and passing the best judgment orders is not
justifiable and not lawful.
15. The appellant further points out that it has filed the returns in Form
GSTR-1, that means actually scored outward taxable supplies are disclosed to the
Department, and as such there are no circumstances or logic to estimate the out-
ward supplies turnovers. The appellant also advanced two more objections.
Firstly, the AA has added 50% to its actually scored turnover, while estimating
the total turnover for all the months except for February, 2018. The same analogy
applied by the AA to February, 2018 must have been applied to all the months,
while passing the orders. But, arbitrarily added 50% more turnover without any
basis or evidence. Secondly, the appellant also pointed out that as per the con-
tents of Section 62 a notice under Section 46 ought to have been issued before
passing the best judgment assessment orders as per Section 46, but the A.A has
not issued any such notices for the tax periods from March, 2018 to August, 2018,
and hence such orders are unlawful and liable to be set aside.
16. The appellant further contends that it has already submitted the re-
turns in Form GSTR-3B for the months of December, 2017 to February, 2018,
which shall be seen as a genuine effort by it to discharge its tax due. The appel-
lant in its additional submissions has attempted to interpret Section 39 in an in-
teresting and relevant point of dispute. The appellant contends that as per Sec-
tion 39 of the Act, the returns in Forms GSTR-1, GSTR-2 and GSTR-3 have been
prescribed, but due to the difficulty in the implementation of the relevant returns
under the Act, which were designed to be implemented as per the scheme ex-
plained supra were not implemented by the Government of India and a new re-
turn in FORM GSTR-3B is prescribed in lieu of the return in FORM GSTR-3 un-
der Rule 61(5) of the CGST Rules, 2017 (‘Rules’ for short). The extract of the said
rule is given below :
“Where the time limit for furnishing of details in FORM GSTR-1 under Sec-
tion 37 and in FORM GSTR-2 under Section 38 has been extended and the
circumstances so warrant, return in FORM GSTR-3B, in lieu of FORM
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