M.M.T.C. LTD. vs. Commissioner Of CGST And Cx Kolkata(North) And Ors
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The appellant, M.M.T.C. LTD., a Government of India Company, filed an intra-court appeal challenging an order dated April 1, 2024, passed by the learned writ court. The writ petition had challenged an order of adjudication dated November 9, 2023, and a show cause notice dated August 31, 2023, issued under the CGST Act by the Additional Commissioner of CGST and Central Excise, Kolkata North Commissionerate. The writ court had declined to entertain the writ petition, holding that the adjudication order was detailed, considered legal provisions and citations, and did not violate principles of natural justice, nor was it passed without jurisdiction or as a non-speaking order. The writ court relegated the appellant to avail the statutory appellate remedy.
Held
The Court held that the learned writ court was correct in declining to entertain the writ petition and relegating the appellant to the statutory appellate remedy. The Court found no assistance from the precedent cited by the appellant, Syed Maqbool Ali v. State of Uttar Pradesh and Another, as the present case involved adjudication of disputed questions of fact under the CGST Act. The Court noted that the appellant was afforded an opportunity of personal hearing, represented before the authority, and the authority provided detailed reasons in its adjudication order. A primary ground raised by the appellant was whether the supply of lentil and the deficit price received from the government were exempted from GST. The adjudication order, in paragraph 5.14, examined this stand and concluded that the amount received was consideration, not a subsidy. Therefore, since disputed questions of fact had been adjudicated by the authority and an appeal mechanism was available under the Act before the Commissioner of CGST and Central Excise (Appeals), the writ petition should not have been entertained. The Court found no grounds to interfere with the order of the learned Single Bench.
Key Issues
1. Whether the learned writ court erred in declining to exercise its jurisdiction under Article 226 of the Constitution of India and relegating the appellant to the statutory appellate remedy, despite the appellant's contention that interference was necessary and availing the statutory remedy was not required? Petitioner's Contention: The appellant argued that the order passed by the writ petition calls for interference and it is not necessary to invoke the statutory appellate remedy. They relied on the Supreme Court decision in Syed Maqbool Ali v. State of Uttar Pradesh and Another, emphasizing that the High Court should consider if a matter involves a public law element or violation of fundamental rights, rather than dismissing it solely on the ground of alternative remedy. Revenue's Contention: The CGST authorities and Union of India contended, implicitly through the writ court's findings, that the adjudication order was detailed, considered all submissions, and did not suffer from any procedural infirmities. They argued that disputed questions of fact required adjudication, which had been done by the adjudicating authority, and the statutory appeal mechanism was the appropriate recourse.
Sections Cited
CGST Act
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Cause title — parties, addresses and appearances
is a non-speaking order.
Therefore, the learned writ court declined to exercise its juri iction under Article 226 of the Constitution of India and relegated the appellant to avail the statutory appellate remedy.
The learned advocate appearing for the appellant has vehemently contended that the order passed in the writ petition calls for interference and it is not necessary for the appellant to invoke the statutory appellate remedy.
In support of his contention reliance was placed on the decision of the Hon’ble Supreme Court in Syed Maqbool Ali v. State of Uttar Pradesh and Another in (2011) 15 SCC 383 and paragraph 11 of the judgment was relied upon. In the said case the question which fell for consideration before the Hon’ble Supreme Court whether the High Court could have dismissed a writ petition seeking a direction to acquire the land and pay compensation on the ground that the land of the appellant therein has been taken over without acquisition by holding that the remedy lies under Section 18 of the Act.
3
Considering the factual position, the Hon’ble Supreme Court held that the question that will ultimately weigh with the High Court is whether the person is seeking remedy in a matter which is primarily a civil dispute to be decided by a civil court, or whether the matter relates to a dispute having a public law element or violation of any fundamental right or to any arbitrary and high-handed action.
We failed to understand as to how the decision can in any manner be of the assistance to the appellant.
As pointed out earlier what was impugned in the writ petition passed under the CGST Act, the appellant had afforded an opportunity of personal hearing, they were represented before the authority, the authority has given detailed reasons in support of its conclusion.
Undoubtedly, to adjudicate the correctness of the order of adjudication dated 9th November, 2023 questions of fact have to be gone into. Even in the writ petition one of the primary grounds raised by the writ petitioner was whether the CGST department loss sight of the fact that supply of lentil is exempted and, therefore, the amount received by the writ petitioner from government towards deficit price of lentil also is exempted from payment of any GST on the same.
4
On a cursory perusal of the adjudication order which was impugned in the writ petition, we find in paragraph 5.14 the stand taken by the appellant was examined and the authority for such reasons recorded therein as held that the claim of the appellant that it is a subsidy is incorrect and it is a consideration.
Thus, disputed questions of fact have to be adjudicated and that was adjudicated by the authority and he has arrived at a conclusion.
If the appellant is aggrieved by the finding and appeal has been provided under the Act before the Commissioner of CGST and Central Excise (Appeals) Kolkata without exhausting such remedy, the writ petition could not have been failed and rightly refused to be entertained by the learned writ court.
Thus, for the above reasons, we find no grounds to interfere with the order passed by the learned Single Bench.
Accordingly appeal fails and dismissed.
(T. S. SIVAGNANAM)
CHIEF JUSTICE
(HIRANMAY BHATTACHARYYA, J.)
Reproduced from the public record of the Calcutta High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.