Advance ruling authority must decide application despite pre-show cause notice under SGST Act Section 73(5)

The Bombay HC disposed of a petition challenging a pre-show cause notice under SGST Act Section 73(5). The petitioner sought advance ruling on taxability of land and building sales. The court held that the advance ruling authority cannot avoid deciding the petitioner's application based on subsequent pre-show cause notice issuance, as Section 98(2) proviso uses "already pending" referring to applications pending when advance ruling was sought. The authority was directed to dispose of the application within three months. The court noted minimal scope for interference with pre-show cause notices and criticized petitioners for prematurely approaching courts without exhausting alternate remedies.

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Issues:
Challenge to pre-show cause notice in Form DRC-01 A under SGST Act and seeking Writ of Mandamus for advance ruling on taxability of sale of land and buildings.

Analysis:
The petition challenged a pre-show cause notice issued under the State Goods and Services Tax Act (SGST) and sought a Writ of Mandamus for an advance ruling on the taxability of a sale of land and buildings. The petitioner expressed concerns that the issuance of the notice might hinder the disposal of their advance ruling application. The counsel argued that the statutory provisions required a decision on the application within 90 days, which had not been done yet. However, the respondent assured the court that the application would be decided within three months. The provisions of Section 98 of the SGST Act were extensively discussed, emphasizing the timelines and procedures for advance rulings.

The court referred to relevant case laws from the Telangana High Court to interpret the provisions of Section 98. It was noted that the authority should not reject an application if the question raised was not pending or decided at the time of filing. The court held that the subsequent pre-show cause notice should not prevent the authority from deciding the application on its merits. The phrase "already pending" was crucial in determining the timeline for considering such applications. The court emphasized that the authority must decide the application without being influenced by subsequent issues like show cause notices.

The petitioner sought a restraint on the proceedings related to the pre-show cause notice until the application was decided. However, the court declined this request, citing minimal scope for interference with such notices. The court highlighted the importance of exhausting alternate remedies before approaching the court prematurely. Ultimately, the court disposed of the petition by issuing directions for the timely disposal of the application and emphasized the need to follow due process and exhaust alternate remedies before seeking court intervention.

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