Gujarat HC Declines Writ Jurisdiction in GST Section 74 Matter, Directs Assessee to Pursue Appellate Remedy Under Section 107
Introduction
The Gujarat High Court has recently refused to exercise its extraordinary writ jurisdiction under Article 226 of the Constitution in a matter concerning proceedings initiated under Section 74 of the Goods and Services Tax Act, 2017. The Court directed the assessee to pursue the statutory appellate remedy available under Section 107 of the GST Act, emphasizing that exceptional circumstances must be demonstrated before invoking writ jurisdiction when alternative efficacious remedies exist under the statute.
In the case of Super Service Point Vs Union of India & Ors., the High Court dismissed the writ petition, holding that the assessee had failed to establish any exceptional circumstances that would warrant bypassing the statutory appellate mechanism provided under the GST framework.
Background of the Case
The assessee in this matter approached the Gujarat High Court by filing a writ petition seeking to challenge multiple proceedings and orders passed by the GST authorities. The grievance centered around actions taken by the revenue authorities under Section 74 of the Goods and Services Tax Act, 2017.
Nature of the Dispute
The assessee contested the legality and propriety of several documents and orders issued by different GST authorities. The primary challenge was directed against a consolidated order passed by the adjudicating authority covering an extended tax period spanning from July 2017 to March 2022.
Relief Sought by the Assessee
The assessee approached the High Court seeking multiple reliefs, including:
- Quashing of the Order-in-Original dated 23.01.2025 passed by the adjudicating authority under
Section 74of the CGST Act - Quashing of the Summary Order issued in Form GST DRC-07 dated 03.02.2025
- Quashing of the Demand-cum-Show Cause Notice dated 31.07.2024
- Quashing of the Summary Notice dated 03.08.2024
- Interim relief seeking stay on the operation of the impugned orders and restraining the authorities from taking coercive measures
Principal Contention of the Assessee
The core argument advanced by the assessee was that the adjudicating authority committed a procedural irregularity by issuing a single consolidated order addressing the entire GST period from July 2017 to March 2022. According to the assessee, separate orders ought to have been passed rather than clubbing the entire period into one consolidated order following the consolidated show cause notice.
Court's Analysis on Alternative Remedy
The Gujarat High Court addressed the fundamental question of whether the writ petition should be entertained when a statutory appellate remedy exists under the GST Act.
Availability of Statutory Appeal Under Section 107
The Court observed that the assessee had a clear and effective alternative remedy available under Section 107 of the GST Act. This provision enables an aggrieved person to prefer an appeal before the appellate authority against orders passed by the adjudicating authority.
Legal Position on Writ Jurisdiction
The Court noted that while the existence of an alternative remedy does not constitute an absolute bar to entertaining writ petitions under Article 226 of the Constitution of India, the discretionary jurisdiction should ordinarily not be exercised when adequate statutory remedies are available.
Supreme Court Precedent Applied
The Gujarat High Court placed substantial reliance on the authoritative pronouncement of the Supreme Court of India in the case of Assistant Commissioner of State Tax & Others v. M/s Commercial Steel Limited reported in (2021) 9 TR 4632.