M/S Om Dhanalaxmi Traders vs. Union Of INDIA Ministry Of Finance

Held

The High Court disposed of the writ petitions without expressing any opinion on the merits of the cases. The court directed the petitioners to prefer appeals before the GST Appellate Tribunal within the window period prescribed by the Tribunal's order dated September 24, 2025. The petitioners were also ordered to deposit 100% of the tax amount within eight weeks from the date of the order. Upon making such pre-deposit within the stipulated time, no coercive action would be taken against the petitioners until the decision of the GSTAT. The court noted that the Finance Act, 2025, amended Section 112 of the CGST Act, 2017, by adding a proviso to sub-section (8) concerning appeals demanding penalty without tax demand, requiring a pre-deposit of ten percent of the penalty. The court's decision was based on its previous practice in similar circumstances, relegating aggrieved petitioners to the Appellate Tribunal. No costs were awarded.

Facts

The petitioners, Likasan Traders and Sri Mukesh Dhoot, challenged orders-in-appeal dated April 29, 2025, which upheld orders-in-original imposing penalties. The appellate authority had refused to interfere with these original orders. The writ petitions were filed before the High Court of Telangana. During the hearing, it was brought to the court's attention that the Goods and Services Tax Appellate Tribunal (GSTAT) had commenced functioning. The impugned orders-in-appeal were dated April 29, 2025. The petitioners sought permission to deposit 100% of the tax amount within eight weeks, citing substantial tax liability.

Key Issues

1. Whether the writ petitions are maintainable before the High Court, given the commencement of functioning of the GST Appellate Tribunal and the availability of an alternative remedy under Section 112 of the Central Goods and Services Tax Act, 2017? Petitioner's Argument: The petitioners argued that due to the substantial tax liability, they should be permitted to make a 100% deposit of the tax amount within a period of eight weeks. They implicitly sought relief from the High Court rather than being relegated to the Tribunal immediately. Revenue's Argument: The respondents, represented by the Deputy Solicitor General of India and Senior Standing Counsel for CBIC, did not explicitly record arguments regarding the maintainability of the writ petition. However, their appearance and representation suggest they would rely on the statutory remedy available before the GSTAT.