Mrs Realty PVT LTD And Anr vs. Union Of INDIA And Ors.

Held

The Court agreed with the view taken by the learned Single Judge. The Court held that there is a presumption of validity attached to statutes. Consequently, when a prayer is made to declare a statutory provision ultra vires, the question of granting an interim order that would stay such provisions cannot be granted. The Court noted that the submission regarding the prayer being an alternative one was not made before the Single Bench. While refusing to interfere with the impugned order, the Court directed the appellants to file their affidavit-in-reply to the affidavit-in-opposition filed by the respondents within three weeks. Upon filing the affidavit-in-reply, the matter would be placed before the appropriate Single Bench for necessary orders. The Court also directed the third respondent/Official Liquidator to file an affidavit-in-opposition to assist the Court on facts. The appeal and connected applications were disposed of.

Facts

The appellants, M/s. Realty Pvt. Ltd. & Anr., filed a writ petition challenging provisions of the CGST/WBGST Act and Rules. The writ petition included a prayer to declare Rule 86A of the CGST Rules/WBGST Rules ultra vires and to read down Section 16(2)(c) of the CGST/WBGST Act. The learned Single Judge, by an order dated 29th June 2021, refused to grant interim relief at the admission stage, opining that an affidavit-in-opposition was required for proper adjudication. The appellants preferred this intra-Court mandamus appeal against the Single Judge's order. The respondents have filed their affidavit-in-opposition, but the appellants have not yet filed their affidavit-in-reply.

Key Issues

1. Whether the learned Single Judge erred in refusing to grant interim relief at the admission stage, considering the prayer to declare statutory provisions ultra vires and unconstitutional. Petitioner's argument: The petitioner contended that the prayer to declare statutory provisions unconstitutional and ultra vires was an alternative prayer. However, the Court noted that this submission was not made before the learned Single Bench. Revenue/State's argument: The respondents argued that there is a presumption attached to the validity of a statute, and therefore, granting an interim order that would have the effect of staying statutory provisions cannot be granted when the prayer is to declare such provisions ultra vires. The respondents filed an affidavit-in-opposition.