M/S Narayani Trading vs. The Union Of INDIA

Held

The Court held that the writ petition is not maintainable. The Court noted that the show cause notice dated 27.11.2023, along with three reminders on 09.01.2024, 01.02.2024, and 21.03.2024, were issued to the petitioner on the common portal. The petitioner, in an 'indolent approach', failed to respond to these notices, compelling the respondent department to pass an ex-parte order. The Court found that the petitioner had an alternative remedy of appeal available under Section 107 of the CGST/BGST Act, 2017, but failed to file any appeal within the statutory period. Instead, the petitioner filed the present writ application after an inordinate delay of almost two years. The Court relied on its previous judgment in CWJC No. 6180 of 2026 (M.K Traders Vrs. State of Bihar & Ors.), which held that entertaining a writ application filed after unexplained delay would frustrate legislative intent and render the legislative scheme otiose. The Court also referenced the Supreme Court's judgment in ACST Vrs. M/s Commercial Steel Ltd., which stated that while an alternative remedy is not an absolute bar to a writ petition in exceptional circumstances, the present case did not fall under such exceptions due to the delay and failure to avail the statutory remedy. Therefore, the writ application was dismissed.

Facts

M/s Narayani Trading, a proprietary concern, filed a writ petition challenging a show cause notice dated 27.11.2023 and an order dated 30.03.2024 passed by the Assistant Commissioner of State Taxes, Patna City West Circle. The petitioner sought quashing of these documents and refund of Rs. 32,56,003/- recovered pursuant to the order. The petitioner claimed the proprietor, an elderly individual, was not technically savvy and did not receive any physical notices, only discovering the issue when her chartered accountant audited the file in September-October 2025. The revenue contended that notices were served on the common GST portal, which is an effective mode of service under Section 169 of the CGST Act, and that the petitioner had an alternative remedy of appeal under Section 107 of the CGST/BGST Act, 2017, which was not availed within the statutory period.

Key Issues

1. Whether the show cause notice dated 27.11.2023 and the order dated 30.03.2024 passed by the Assistant Commissioner of State Taxes are liable to be quashed on the grounds of non-receipt of proper service of notice, thereby violating principles of natural justice, as argued by the petitioner? 2. Whether the writ petition is maintainable given the existence of an alternative statutory remedy of appeal under Section 107 of the CGST/BGST Act, 2017, and the inordinate delay in filing the writ petition, as contended by the revenue? Petitioner's arguments: The petitioner argued that the proprietor, being old and not technically adept, did not receive any physical notices and was unaware of the proceedings until much later. They relied on a previous judgment of the High Court in M/s Shree Shyam Trading Co. Vrs Union of India, which held that there must be at least two modes of service of notice. Revenue's arguments: The revenue contended that service of notice on the common GST portal is effective under Section 169 of the CGST Act. They further argued that the petitioner had an alternative remedy of appeal under Section 107 of the CGST/BGST Act, 2017, but failed to file it within the statutory period, and instead filed the present writ petition after a delay of almost two years, making it unfit for entertainment.