Telangana High Court permits delayed GST appeal and halts coercive recovery for limited period

Overview of the decision

In Mr. Imthiaz Ali Mohammed Vs Superintendent of Central Tax, the Telangana High Court adopted a pragmatic stance in a situation where an assessee came to know of a GST demand only after bank attachment proceedings had begun. Instead of quashing the proceedings outright, the Court:

  • Allowed the assessee to file a belated statutory appeal against the Section 74 demand order; and
  • Granted short-term protection from coercive recovery under the garnishee notice in Form GST DRC-13.

The ruling demonstrates how High Courts are balancing the principle of exhaustion of remedies with the need to prevent harsh recovery where the assessee shows bona fides and the appellate remedy remains viable.

Factual matrix

The petitioner, proprietor of M/s Mawa Medicals and Surgicals, approached the Telangana High Court challenging:

  • Order-in-Original dated 24.02.2025;
  • Summary of Order in Form GST DRC-07 dated 25.02.2025; and
  • Proceedings under Section 74 of the CGST/SGST Acts for tax period 2020-21.

According to the petitioner, the demand came to his notice only when the department issued a garnishee notice in Form GST DRC-13 dated 15.01.2026 for attachment of his bank account.

On this basis, a writ of mandamus was sought to:

  • Declare the Order-in-Original, the summary in Form GST DRC-07, and the Section 74 proceedings as arbitrary and violative of the CGST/SGST Acts, 2017 and Articles 14, 19(2)(g), 21 and 265 of the Constitution of India; and
  • Set aside the said orders and consequential actions as null and void.

However, during arguments, the focus shifted from quashing the orders to enabling the assessee to access the appellate forum.

The High Court was primarily concerned with two interlinked issues:

  1. Whether the assessee should be allowed to file a belated statutory appeal against the Order-in-Original and corresponding DRC-07 summary, even though the prescribed time limit had apparently lapsed by the time the garnishee notice came to his knowledge.

  2. Whether interim protection against coercive recovery—specifically the garnishee proceedings attaching the bank account—should be granted, so that the right of appeal remains meaningful and not rendered illusory by immediate recovery.

The Court consciously refrained from delving into the correctness of the assessment or the validity of the Section 74 proceedings, as the assessee expressed readiness to pursue the statutory appellate route.

Submissions on behalf of the assessee

Learned counsel for the petitioner advanced the following key points:

  • The assessee became aware of the GST demand only upon receiving the garnishee notice in Form GST DRC-13 dated 15.01.2026, when his bank account was attached.
  • The Order-in-Original and Form GST DRC-07 summary were asserted to be arbitrary and contrary to the scheme of the CGST/SGST Acts, and also inconsistent with constitutional guarantees under Articles 14, 19(2)(g), 21 and 265.
  • It was argued that coercive recovery through bank attachment had already been set in motion without the assessee having a fair opportunity to contest the demand.
  • During the hearing, counsel requested liberty to withdraw the writ petition and instead pursue the statutory appellate remedy, emphasising that:
    • Some delay in approaching the appellate authority was unavoidable; and
    • The appellate authority should be directed to adopt a liberal approach towards condoning such delay, considering that the assessee was bona fide pursuing relief before the High Court.

In essence, the petitioner did not press for a writ adjudication on merits but sought a procedural safeguard: the right to appeal with condonation of delay and protection from harsh recovery meanwhile.

Stand of the revenue

Learned Senior Standing Counsel for CBIC opposed the need for writ interference on the following broad grounds:

  • The assessee had an effective and adequate statutory remedy of appeal against the Order-in-Original and the DRC-07 summary.
  • All grievances, whether factual or legal, could appropriately be canvassed before the appellate authority under the CGST/SGST regime.
  • If the assessee chose to file an appeal with:
    • the prescribed statutory pre-deposit, and
    • an **appl...