M/S Lunatash Biotech Private Limited vs. The Union Of INDIA
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The petitioner, M/s Lunatash Biotech Private Limited, is challenging an order dated 26.08.2022 that cancelled its GST registration. The petitioner acknowledges an appellate remedy under Section 107 of the Bihar Goods and Services Tax Act, 2017, which allows filing an appeal within three months and a further month for delay condonation with satisfactory reasons. However, the petitioner filed its appeal on 15.11.2023, over eleven months after the expiry of the initial limitation period. The petitioner did not avail of the Amnesty Scheme offered by Circular No. 3 of 2023, which allowed restoration of registration for cancelled dealers during a specific period. The petitioner also does not dispute receiving the show-cause notice for cancellation, which cited non-filing of returns for a continuous period of six months.
Held
The Court held that it would not invoke its extraordinary jurisdiction under Article 226 of the Constitution. The reasoning was that an alternate remedy of appeal was available to the petitioner under Section 107 of the Bihar Goods and Services Tax Act, 2017. The Court noted that the petitioner had not been diligent in availing this remedy, having filed the appeal significantly beyond the prescribed limitation period. The Court emphasized that the law favors diligent individuals and not those who are indolent. Furthermore, the Court observed that the petitioner had also failed to avail of the Amnesty Scheme offered by Circular No. 3 of 2023 for the restoration of cancelled registrations. The Court also found no dispute from the petitioner regarding the receipt of the show-cause notice or the reason for cancellation, which was non-filing of returns for six continuous months. Therefore, the writ petition was dismissed. The ratio decidendi is that writ jurisdiction will not be exercised where statutory remedies are available and have not been pursued diligently by the petitioner.
Key Issues
1. Whether the High Court should exercise its extraordinary writ jurisdiction under Article 226 of the Constitution of India to entertain a challenge to the cancellation of GST registration when an alternate statutory remedy of appeal is available, and the petitioner has failed to diligently avail it within the prescribed time limits? Petitioner's Argument: The petitioner implicitly seeks relief through the writ jurisdiction, likely arguing for a waiver of the delay in filing the appeal or for the court to address the merits of the cancellation. However, the judgment does not explicitly record any specific arguments made by the petitioner regarding the delay or the merits of the cancellation. Revenue's Argument: The respondents, represented by the Union of India and other GST authorities, would argue that the writ petition is not maintainable due to the availability of an effective alternate remedy under Section 107 of the BGST Act. They would emphasize the petitioner's failure to comply with the statutory timelines for filing the appeal and the condonation of delay, highlighting that the law favors diligent litigants. They would also point to the petitioner's failure to avail the Amnesty Scheme and the lack of dispute regarding the show-cause notice or the reason for cancellation (non-filing of returns).
Sections Cited
Section 107
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Cause title — parties, addresses and appearances
ORAL JUDGMENT (Per: HONOURABLE THE CHIEF JUSTICE) Date : 19-02-2024 The petitioner is aggrieved with the cancellation of registration by Annexure-P2 order passed on 26.08.2022. 2. Admittedly, there is an appellate remedy which the petitioner availed with delay.
Section 107 of the Bihar Goods and Services Tax Act, 2017 (“BGST Act” hereafter) permits an appeal to be filed 2/3 within three months and also apply for delay condonation with satisfactory reasons within a further period of one month. Here, the order impugned in the appeal was dated 26.08.2022. An appeal was to be filed on or before 25.11.2022 and if necessary with a delay condonation application within one month thereafter. The appeal is said to have been filed only on 15.11.2023, after eleven months twenty days from the date on which even the limitation period expired.
In the above circumstances, we find no reason to invoke the extraordinary juri iction under Article 226, especially since it is not a measure to be employed where there are alternate remedies available and the assessee has not been diligent in availing such alternate remedies within the stipulated time. The law favours the diligent and not the indolent.
Further, the Government had come out with an Amnesty Scheme by Circular No. 3 of 2023, by which the registered dealers, whose registrations were cancelled were permitted to restore their registration on payment of all dues between 31.03.2023 to 31.08.2023. The petitioner did not avail of such remedy also.
The petitioner does not have any case that the show-cause notice was not received by him. Further, it is also 3/3 pertinent that the reason stated in the show-cause notice for cancellation of registration is that the petitioner has not filed returns for a continuous period of six months. The petitioner does not have any case that he had in fact filed a return in the continuous period of six months.
The writ petition would stand dismissed.
Sujit/- (K. Vinod Chandran, CJ) ( Rajiv Roy, J) AFR/NAFR NAFR CAV DATE Uploading Date 21.02.2024 Transmission Date
Reproduced from the public record of the Patna High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.