No GST on Amount Collected Towards Penalty Imposed by LPG Corporation for Non-Attendance of Leakage Complaint | HC
- Blog|News|GST & Customs|
- 2 Min Read
- By Taxmann
- |
- Last Updated on 9 January, 2025
Latest from Taxmann
Case Details: Aswathy Gas Agencies v. Indian Oil Corporation Ltd. - 169 taxmann.com 740 (Kerala)
Judiciary and Counsel Details
- Harisankar V. Menon, J.
-
R. Surendran & Kum. S. Mayukha, Advs. for the Petitioner.
-
M. Gopikrishnan Nambiar, K. John Mathai, Joson Manavalan, Kuryan Thomas, Paulose C. Abraham, E.K. Nandakumar, Smt. Ramola Nayanpally & Raja Kannan, Advs. for the Respondent.
Facts of the Case
In the present case, the writ petition was filed by the LPG distributors appointed by the LPG Corporation challenging the levy of penalty and GST on such penalties. The LPG Corporation imposed penalties on the distributors for not attending a leakage complaint as per Marketing Discipline Guidelines 2018. The GST department raised demand of GST on the amount of penalty. Aggrieved by the demand, the LPG distributors filed a writ petition before the Kerala High Court.
High Court Held
The Honorable High Court observed that the GST department’s contention relied on the argument that the penalties constituted a ‘supply of services’ by the LPG Corporation to the distributors. However, no ‘supply of service’ was affected by the LPG Corporation to the LPG distributors while imposing penalties. It clarified that, under GST law, the demand for GST can only arise if there is a supply of goods or services.
Further, the amounts sought to be recovered were not towards tolerating an act/situation. Instead, the amounts sought to be recovered were for not following the terms of the agreement/MDG framed by the LPG Corporation. Thus, the Kerala High Court held that the LPG Corporation was not entitled to collect GST from the LPG distributors.
Disclaimer: The content/information published on the website is only for general information of the user and shall not be construed as legal advice. While the Taxmann has exercised reasonable efforts to ensure the veracity of information/content published, Taxmann shall be under no liability in any manner whatsoever for incorrect information, if any.
Taxmann Publications has a dedicated in-house Research & Editorial Team. This team consists of a team of Chartered Accountants, Company Secretaries, and Lawyers. This team works under the guidance and supervision of editor-in-chief Mr Rakesh Bhargava.
The Research and Editorial Team is responsible for developing reliable and accurate content for the readers. The team follows the six-sigma approach to achieve the benchmark of zero error in its publications and research platforms. The team ensures that the following publication guidelines are thoroughly followed while developing the content:
- The statutory material is obtained only from the authorized and reliable sources
- All the latest developments in the judicial and legislative fields are covered
- Prepare the analytical write-ups on current, controversial, and important issues to help the readers to understand the concept and its implications
- Every content published by Taxmann is complete, accurate and lucid
- All evidence-based statements are supported with proper reference to Section, Circular No., Notification No. or citations
- The golden rules of grammar, style and consistency are thoroughly followed
- Font and size that’s easy to read and remain consistent across all imprint and digital publications are applied
Sign Up
To subscribe to our weekly newsletter please log in/register on Taxmann.com
Latest Books
Everything on Tax and Corporate Laws of India
To subscribe to our weekly newsletter please log in/register on Taxmann.com
CA | CS | CMA
