Writ petition dismissed for challenging tax determination without filing statutory appeal under Section 107 within limitation period

The HC dismissed a writ petition challenging tax, interest and penalty determination on royalty under RGST/CGST Act, 2017. The petitioner failed to file statutory appeal within the prescribed limitation period under Section 107 and allowed the assessment order to become final. The court found no plausible explanation for not pursuing the statutory remedy. Following SC precedent in Assistant Commissioner v. Glaxo Smith Kline Consumer Health Care Limited, the petition was held not maintainable as the petitioner consciously chose not to file appeal despite being given proper hearing opportunity through show cause notice.

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Issues:
The correctness and validity of the show cause notice and order u/s 74 of the Rajasthan Goods and Services Tax Act, 2017 and the Central Goods and Services Tax Act, 2017 for financial year 2018-19.

Summary:
The petitioner challenged a show cause notice and order issued by Respondent No. 3 under Section 74 of the RGST Act, 2017/CGST Act, 2017 for the financial year 2018-19, directing the petitioner to deposit a specific amount towards service tax on royalty, interest, and penalty. Despite multiple grounds raised in the writ petition to challenge the notice and order, the petitioner did not file an appeal within the prescribed limitation period or seek condonation for delay. Referring to the decision of the Hon'ble Supreme Court in a similar case, it was argued that the present writ petition is not maintainable due to the failure to utilize the statutory remedy of appeal.

In the case of Glaxo Smith Kline Consumer Health Care Limited, the High Court entertained a challenge to an assessment order despite the statutory remedy of appeal being foreclosed due to a delay in filing. The Supreme Court held that the remedy of appeal is a creation of statute and emphasized the importance of adhering to statutory timelines for filing appeals. The Court found that the petitioner in that case failed to provide a satisfactory explanation for the delay in filing the appeal, leading to the dismissal of the writ petition.

The Supreme Court concluded that the writ petition challenging the assessment order was not maintainable due to the failure to file an appeal within the statutory period. In the present case, the petitioner did not file an appeal against the order determining tax, interest, and penalty, and instead approached the Court through a writ petition. The Court noted that the petitioner did not offer a plausible explanation for not availing the statutory appeal remedy, indicating a conscious choice to wait for the limitation period to expire. As a result, the Court held that the writ petition, in line with the precedent set in the Glaxo Smith Kline case, was not maintainable and dismissed the petition.

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