2024 (5) TMI 657 - HC - GST

Writ petition dismissed for challenging GST assessment without filing statutory appeal under Section 107 within limitation period

M/s Thekedar Murari Lal Sharma Versus State of Rajasthan, Commissioner, State Goods And Service Tax, Jaipur, Assistant Commissioner, Ward No. II Rajasthan.

The HC dismissed a writ petition challenging a GST assessment order dated 22.03.2023 levying tax, interest and penalty on royalty. The petitioner failed ... Maintainability of petition - alternative remedy not availed - assessment order challenged on the sole ground that the statutory remedy of appeal against that order stood foreclosed by law of limitation - Levy of GST on royalty. The petitioner did not file any appeal either within the period of limitation as prescribed under Section 107 of the RGST Act, 2017/ the CGST Act, 2017 or within the maximum period thereafter which could be condoned under the power to condone the delay in filing of the appeal. HELD THAT:- Present is a case where the petitioner did not even file appeal and allowed the order passed in assessment proceedings to become final and thereafter approached this Court by filing writ petition seeking to challenge the determination of tax, interest and penalty by the competent authority vide order dated 22.03.2023. Present is not a case where the order under Section 74 of the RGST Act, 2017/ the CGST Act, 2017 levying tax along with interest and penalty was passed without giving any opportunity of hearing to the petitioner. Even according to the petitioner, he was issued show cause notice and thereafter, impugned order was passed. In the writ petition, no plausible explanation has been offered as to why the petitioner did not take recourse to the remedy of statutory appeal. It, therefore, appears that the petitioner consciously did not choose to take recourse to the remedy of appeal as provided under Section 107 of the RGST Act, 2017/the CGST Act, 2017, but waited for the expiry of the period of limitation for filing appeal as also the maximum period of delay which could be condoned in the exercise of powers conferred upon the appellate authority under the provisions of Section 107 of the RGST Act, 2017/ the CGST Act, 2017. In the case of ASSISTANT COMMISSIONER (CT) LTU, KAKINADA & ORS. VERSUS M/S. GLAXO SMITH KLINE CONSUMER HEALTH CARE LIMITED [2020 (5) TMI 149 - SUPREME COURT], the question which arose for consideration was whether the High Court in exercise of its writ jurisdiction under Article 226 of the Constitution of India, ought to entertain a challenge to the assessment order on the sole ground that the statutory remedy of appeal against that order stood foreclosed by law of limitation - the Hon'ble Supreme Court arrived at the conclusion that in such circumstances, the writ petition was not maintainable and was liable to be dismissed. Having not preferred an appeal, the petition in the present case, in view of the decision of Hon'ble Supreme Court in the case of Glaxo Smith Kline Consumer Health Care Limited is not maintainable - petition dismissed. Issues involved:The correctness and validity of show cause notice 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, as well as the order directing deposit of tax liability, interest, and penalty.Comprehensive details:Issue 1: Challenge to show cause notice and orderThe petitioner questioned the show cause notice and order directing payment of Rs. 9,19,018/- towards service tax on royalty, interest, and penalty. The respondents argued that the petitioner did not file an appeal within the prescribed period or seek condonation of delay, citing a Supreme Court decision in a similar case.Issue 2: Precedent from Glaxo Smith Kline caseThe Supreme Court considered a case involving failure to file an appeal within the statutory period, leading to a writ petition seeking to quash the assessment order. The Court held that the writ petition was not maintainable in such circumstances, emphasizing the importance of adhering to statutory appeal timelines.Issue 3: Maintainability of writ petitionIn the present case, the petitioner did not file an appeal against the tax determination order but directly approached the Court through a writ petition. The Court noted that the petitioner failed to provide a satisfactory explanation for not availing the statutory appeal remedy, leading to the dismissal of the writ petition based on the precedent set by the Glaxo Smith Kline case.Conclusion:The Court dismissed the writ petition as the petitioner did not opt for the statutory appeal route, following the precedent established by the Glaxo Smith Kline case. The decision highlighted the importance of adhering to appeal timelines and utilizing statutory remedies in tax matters.