M/S Rajdhani Traders vs. Central Board Of Indirect Taxes And Customs

Held

The Court held that the writ petition is not maintainable in the first instance due to the availability of an alternative statutory remedy. The Court reasoned that Section 107 of the CGST Act, 2017, provides a clear and prescribed procedure for any person aggrieved by an order of an adjudicating authority to file an appeal before the Appellate Authority within three months of the order's communication. The Court found no compelling reason to bypass this statutory mechanism. Consequently, the writ petition was dismissed. However, the Court granted liberty to the petitioner to file an appeal before the appellate authority, directing that the time spent pursuing the writ petition in the High Court would be excluded for calculating the limitation period, provided the appeal is filed within 30 days. The challenge to the circular dated 06.07.2022 was left open to be adjudicated in future appropriate proceedings, and the petitioner was granted liberty to file a fresh writ petition solely for challenging the circular if so advised.

Facts

The petitioner, M/s Rajdhani Traders, filed a writ petition challenging an Order-in-Original dated 24.12.2025, passed by the Assistant Commissioner, CGST, Alwar. This order raised a GST demand of Rs. 1,13,57,300/- for the financial years 2018-2019 and 2019-2020, alleging wrongful availment and utilization of Input Tax Credit (ITC). The respondents, including the Central Board of Indirect Taxes and Customs and the State of Rajasthan, objected to the maintainability of the writ petition, citing the availability of an alternative statutory remedy under Section 107 of the CGST Act, 2017.

Key Issues

1. Whether the writ petition is maintainable when an alternative statutory remedy under Section 107 of the CGST Act, 2017, is available to the petitioner? The petitioner argued that the writ petition was filed to challenge the impugned order and potentially a circular dated 06.07.2022, and that the alternative remedy might not be efficacious. The respondents contended that the writ petition is not maintainable as the petitioner has not exhausted the statutory remedy of appeal under Section 107 of the CGST Act, 2017, which provides a clear mechanism for aggrieved persons to challenge decisions or orders passed by adjudicating authorities. They emphasized that this alternative remedy is the appropriate forum for resolving such disputes.