2021 (7) TMI 1161 - HC - GST

Court emphasizes jurisdictional issues in show cause notice challenges, dismisses petition lacking valid grounds.

Maya Appliances Pvt. Ltd. Versus The Assistant Commissioner, The Commissioner of GST and Central Excise, Union of India, Goods and Services Tax Council, Central Board of Indirect Taxes and Customs, The Chairman, GSTN, East Wing, Word Mark-1

The Court dismissed the petitioner's challenge to the show cause notice validity, emphasizing that such challenges should only be entertained if ... Maintainability of petition - Validity of SCN - SCN asking the petitioner to submit their reply within 30 days - HELD THAT:- The power of judicial review is to scrutinise the processes through which the jurisdiction is taken by the competent authorities in consonance with the law, but not the decision itself. Thus, the Courts always exercise restraint in entertaining a Writ Petition filed against the show cause notices. In the present case, the impugned show cause notice provides all the details regarding allegations. The petitioner is asked to submit their representations/defence or documents to defend their case by availing the opportunity. Therefore, the petitioner is expected to defend their case before the competent authority by submitting their explanations/defence statements and thereafter, the authorities are bound to consider the materials available on record as well as the grounds raised by the petitioner in their defence statement and take a decision and pass speaking order by furnishing reasons for such a decision This Court is of the considered opinion that the writ petitioner has not established any acceptable ground for the purpose of entertaining the Writ Petition - Petition dismissed. Issues:Challenge to show cause notice validity.Analysis:The petitioner, a manufacturer and supplier of various products, challenged a show cause notice dated 11.06.2021, requiring a response within 30 days. The petitioner is a registered taxpayer under the Goods and Services Tax regime and compliant with relevant tax laws. The petitioner contended that similar issues were pending in another case where the Madras High Court had set aside an order and remanded the matter. However, the Court noted that an interim order from the High Court of Andhra Pradesh could not be considered a precedent for admitting the present Writ Petition.The Court emphasized that a writ against a show cause notice should only be entertained if it is shown that the issuing authority lacked jurisdiction or if allegations of malafides exist. In cases of malafides, the concerned authority must be included as a party respondent in their personal capacity. The Court clarified that factual issues should be addressed by the competent authority based on available documents and evidence, not in a writ proceeding.Furthermore, the Court highlighted that challenges related to jurisdiction should be decided based on facts and referred to the competent authority and appellate authority for resolution. Adjudication based solely on affidavits or selective document copies filed with the Writ Petition was deemed inappropriate, as it could lead to errors and allow individuals to evade legal consequences.The judgment stressed that judicial review aims to ensure the authority's jurisdiction complies with the law, not to review the decision itself. The Court cautioned against filing Writ Petitions against show cause notices unless valid grounds are established. In this case, the show cause notice provided detailed allegations, giving the petitioner an opportunity to present their defense. The petitioner was advised to submit explanations and defense statements to the competent authority for consideration, as per the prescribed procedures.Ultimately, the Court found that the petitioner failed to establish sufficient grounds to warrant entertaining the Writ Petition and dismissed it without costs. The connected Miscellaneous Petition was also closed as a result of the judgment.