2025 (8) TMI 1058 - HC - GST

Writ petition dismissed for bypassing statutory remedies and unexplained delay in challenging tax assessment dated 17 August 2024 (Arts.226/227)

Sai Subham Medi Shop Versus Chief Commissioner of CT & GST and Others

Sai Subham Medi Shop Versus Chief Commissioner of CT & GST and Others - TMI ISSUES PRESENTED AND CONSIDERED 1. Whether notifications issued under Section 168A of the GST Act extending the period of limitation to pass orders under Section 73 can be challenged in writ jurisdiction and, if so, whether those notifications are beyond the power conferred by Section 168A. 2. Whether the High Court should exercise its discretionary writ jurisdiction under Articles 226/227 in respect of an adjudication order under Section 73 of the GST Act, when an alternative statutory remedy exists. 3. Whether inordinate delay and unexplained laches in approaching the writ court (an ~11 month gap) justify refusal to entertain a writ petition challenging an order under Section 73, particularly where the petitioner did not respond to the show cause notice and factual disputes remain to be adjudicated by the statutory authority. ISSUE-WISE DETAILED ANALYSIS Issue 1: Validity of notifications under Section 168A extending limitation for Section 73 orders Legal framework: Section 73 prescribes time-limit for passing orders for recovery of tax under the GST Act; Section 168A empowers the Central Government to extend limitation periods by notification. Precedent treatment: The Court considered submissions asserting overreach but did not undertake a detailed constitutional or statutory validity analysis of the notifications. Prior authority cited in the judgment establishes that writ relief may be granted in cases where statutory power is exceeded or procedure fundamentally violated; however, no express conclusion was reached on invalidity of the particular notifications. Interpretation and reasoning: The challenge to the notifications was raised as one of the prayers, but the Court declined to probe the vires of the notifications in substance because the writ challenge suffered from other threshold defects (delay, alternative remedy, absence of compelling reasons). The Court framed the issue but refrained from adjudicating the notifications' validity on merits. Ratio vs. Obiter: The refusal to examine the validity of notifications is not a ratio on the power under Section 168A; it is an interlocutory/threshold disposition (obiter in relation to the vires question) driven by discretionary jurisdiction principles. Conclusions: The question whether the notifications transgress Section 168A remains unadjudicated in the present judgment; the Court declined to entertain the challenge to the notifications because of other controlling factors (delay, alternative remedy, and factual matrix). Issue 2: Appropriateness of exercising writ jurisdiction where alternative statutory remedy exists Legal framework: Article 226/227 confers discretionary writ jurisdiction; settled principles restrict that discretion where efficacious alternative remedies exist under the statute unless there is a breach of fundamental procedural norms, violation of natural justice, or comparable exceptional circumstance. Precedent treatment: The Court relied on established Supreme Court principles (as restated in multiple authoritative decisions) that the writ jurisdiction is discretionary and will not ordinarily be exercised if an adequate statutory remedy is available; exceptions permit writ relief where statutory machinery is abused or procedure violated. Interpretation and reasoning: Applying these principles to the record, the Court found no allegation of total procedural non-compliance, fundamental breach of natural justice, or compelling exceptional circumstances that would displace the availability of the statutory adjudicatory process. The petitioner had an alternative remedy to challenge the order under Section 73 through statutory appellate or revisionary processes; hence, the extraordinary relief by writ was not warranted. Ratio vs. Obiter: This is ratio: the Court concretely applied the settled limitation on writ jurisdiction to decline intervention where adequate statutory remedies exist and no exception (procedural breach/fundamental illegality) was shown. Conclusions: The Court held that discretionary writ relief should be refused because the petitioner had an adequate alternative remedy and did not demonstrate circumstances justifying bypassing the statutory route. Issue 3: Effect of delay, laches, and non-response to show cause notice on entitlement to writ relief Legal framework: Writ jurisdiction is exercised in equity and is sensitive to delay and laches; unexplained or inordinate delay, especially where it prejudices third parties or undermines statutory finality, is a ground for refusing equitable relief. Additionally, factual adjudication is entrusted to statutory authorities when parties have had opportunity to respond to notices. Precedent treatment: The Court invoked well-established authorities establishing that unexplained delay and laches are material in discretionary writ jurisdiction and may bar relief despite possible illegality; courts may refuse writs to the 'tardy and indolent' absent compelling reasons. Interpretation and reasoning: On the facts the petitioner failed to reply to the show cause notice, prompting the adjudicating authority to pass an order determining tax liability. The writ petition was filed approximately 11 months after the impugned order without adequate explanation for delay. The Court emphasized that delay undermines equity, may prejudice third parties, and that the petitioner offered no plausible reason for bypassing the statutory remedy or for waiting nearly a year to seek extraordinary relief. Ratio vs. Obiter: Ratio: the Court refused to exercise discretion on grounds of inordinate delay and laches combined with the petitioner's non-participation in the adjudicatory process (non-response to show cause) and availability of alternative remedy. Conclusions: The Court concluded that inordinate delay and laches, absence of satisfactory explanation, and failure to engage with the statutory process warranted dismissal of the writ petition. The factual disputes should be agitated before competent statutory authorities. Interrelationship and final disposition Legal framework and reasoning synthesis: The Court tied together the three issues: (a) while validity of notifications under Section 168A was raised, the Court refused to adjudicate that question because (b) the petitioner had an alternative statutory remedy and (c) had approached the writ court with inordinate delay and without responding to the show cause notice. Established principles restricting writ relief where alternative remedies exist and where delay/laches are unexplained informed the exercise of discretion. Precedent treatment: The Court adhered to and applied established doctrine limiting Article 226 relief in the presence of alternative remedies and where delay/laches exist, relying on the equity-based discretion described in higher court precedents. Ratio vs. Obiter: The operative ratio is that discretionary writ relief will be refused where there is an adequate alternative remedy and where the petitioner has unreasonably delayed seeking judicial intervention, particularly when the petitioner failed to participate in the statutory adjudicatory process. The Court's non-decision on the vires of the extensions under Section 168A is obiter with respect to that specific validity question. Final conclusion: The writ petition was dismissed for want of discretionary entitlement to writ relief on grounds of alternative remedy, inordinate delay and laches, and non-engagement with the statutory adjudicatory process; issues raised can be agitated before competent authorities under the GST Act and Rules.