M/S.Pride Constructions vs. Deputy Assistant Commissioner (St)(GST)

Held

The High Court dismissed the writ petition, holding that the petitioner had an effective alternative remedy before the appellate authority. The Court referred to the Supreme Court's decision in Assistant Commissioner of State Tax and Others V. M/s Commercial Steel Limited, which outlines circumstances under which a High Court may entertain a writ petition when an alternative remedy exists: breach of fundamental rights, violation of principles of natural justice, excess of jurisdiction, or challenge to the vires of a statute. The Court found that the petitioner had not satisfied any of these conditions. Furthermore, the Court noted that the issues raised by the petitioner, including the examination of taxing proposals and objections, could be adequately considered by the appellate authority. The Court found no glaring illegality in the assessment order that warranted interference under Article 226 of the Constitution at that stage. The petitioner was granted liberty to avail the alternative remedy of approaching the appellate forum.

Facts

The petitioner, M/s Pride Constructions, filed a writ petition challenging an assessment order dated September 1, 2021, passed by the Deputy Assistant Commissioner STGST, Nellore. The order levied tax, interest, and penalty on Transferable Development Rights (TDRs) arising from a Joint Development Agreement-cum-General Power of Attorney entered into on October 30, 2017. The tax period in dispute is July 2017 to November 2019. The petitioner contended that they had already paid tax for all 25 flats developed under the agreement, and the levy on TDRs was erroneous, as any liability should fall on the landowners, not the developer. The petitioner also argued that their objections were not considered, the Assessing Officer lacked jurisdiction, and the tax was levied on the same flats for which tax was already paid.

Key Issues

1. Whether the assessment order passed by the first respondent is illegal, arbitrary, without authorization, against principles of natural justice, contrary to the provisions of the CGST Act, 2017 and APGST Act, 2017, contrary to the Notification and Circular issued by the Union of India, unsustainable in law, passed without application of mind, not considering any of the objections filed by the petitioner, and is without jurisdiction? Petitioner's arguments: The petitioner argued that the assessment order was flawed because none of their objections were considered, as evidenced by paragraph 49 of the order. They also contended that the Assessing Officer lacked jurisdiction and that they were being charged GST on the same flats for which tax had already been paid under CST and APGST. They relied on the Joint Development Agreement-cum-General Power of Attorney and the fact that they had paid tax for all 25 flats. Respondents' arguments: The respondents argued that the Assessing Authority provided clear reasons for rejecting the petitioner's objections. They further contended that an effective alternative remedy in the form of an appeal was available to the petitioner, and therefore, the writ petition should not be entertained at this stage. They relied on the Supreme Court's decision in Assistant Commissioner of State Tax and Others V. M/s Commercial Steel Limited.