The Bombay High Court has held that the writ petition challenging SCN under tax law is not maintainable unless it demonstrates a clear violation of jurisdiction, fundamental rights, or natural justice.
The bench of Justice M. S. Sonak and Justice Jitendra S. Jain has observed that the Court will not entertain a petition for a writ under Art. 226, where the petitioner has an alternative remedy that provides an equally efficacious remedy without being unduly onerous.
The petitioner/assessee has challenged the show cause notice issued by department to the petitioner to centralise and show cause before the department why CGST, SGST and IGST should not be demanded and recovered under Section 74 of the Central Goods and Services Tax Act (CGST), State Goods and Services Tax Act (SGST) and Integrated Goods and Services Tax Act (IGST).
The show cause notice further directs the petitioner to show cause why interest under Section 50 of the CGST Act and the SGST Act should not be demanded and recovered in addition to the penalty under Section 74 of the CGST Act,SGST Act and Section 20 of the IGST Act. By this show cause notice, the issue pending before various State authorities, namely Jammu and Kashmir, Himachal Pradesh, Uttarakhand, Haryana, Uttar Pradesh etc. has been centralised and referred to the department for adjudication.
In the show cause notice, a specific allegation is made on suppressing facts and misstatement regarding non-furnishing details of outward supplies under Section 37 of the CGST Act. There is also an allegation that the facts have been suppressed with the intention to evade the payment of GST. It is further stated in the show cause notice that if the investigation had not been conducted, evasion of GST would not have come to light.
The respondents in the show cause notice have invoked the extended period of limitation based on the allegations of suppression of facts and misstatement with an intention to evade the payment of GST from July 2017 to March 2022. The show cause notice also deals with the onus of proof and its extent of compliance for the purpose of Section 15(3)(b) of the CGST Act.
The department raised the preliminary objection to the entertain ability of the present petition at the stage of the show cause notice. The High Court should not stop the adjudication of the show cause notice and the petitioner should be called upon to reply to the show cause notice and raise all the contentions, including the contention of limitation.
The court held that the petitioner is granted time up to 15 December 2024 to file its reply to the show cause notice.
The court directed the Respondent department to give a personal hearing to the petitioner and, after considering the petitioner’s submissions, pass a reasoned and speaking order on or before 31 January 2025.
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Case Details
Case Title: Apollo Tyres Limited Versus Union of India
Case No.: WRIT PETITION NO.15498 OF 2024
Date: 14 November 2024
Counsel For Petitioner: Mr. Joseph Kodianthara, Senior Advocate
Counsel For Respondent: Mr. Ram Ochani a/w Ms. Sangeeta Yadav
