M/S. Rajendra Trading Company vs. Union Of INDIA

Facts

The petitioner, M/s. Rajendra Trading Company, filed a writ petition before the Rajasthan High Court challenging an assessment order passed under the Rajasthan Goods and Services Tax Act. A primary grievance raised by the petitioner was the non-functional status of the GST Tribunal since the implementation of GST in 2017. The petitioner sought relief in light of this procedural impediment. The respondents, including the Union of India and the State of Rajasthan, acknowledged that the Tribunal had not yet been constituted and that the process was ongoing. They proposed disposing of the petition with appropriate protection under Section 112(8) of the Act, allowing the petitioner to file an appeal within a stipulated period from the Tribunal's constitution.

Held

The Court disposed of the writ petition in terms similar to a previous order in D.B. Civil Writ Petition No.1113/2024. The Court directed that if the petitioner makes payment as per the provisions contained in Sub-section (8) of Section 112 of the Rajasthan Goods and Services Tax Act, 2017, further proceedings for recovery of the balance amount shall not be drawn. The petitioner was granted liberty to avail the statutory remedy of appeal within a period of three months from the date of the constitution of the Tribunal. The Court effectively provided a temporary reprieve and a pathway for appeal once the appellate mechanism becomes operational, acknowledging the current inability to access the statutory appeal route. The operative direction was to deposit the pre-deposit amount as per Section 112(8) within three months from the date of the order.

Key Issues

1. Whether the petitioner can be granted relief in the absence of a functional GST Tribunal, considering the statutory appeal mechanism is unavailable? (Question of law) 2. What is the appropriate course of action for a taxpayer seeking to challenge an assessment order when the appellate tribunal is not constituted? (Question of mixed law and fact) Petitioner's Contentions: The petitioner argued that the non-functional status of the Tribunal prevented them from availing the statutory remedy of appeal, necessitating intervention by the High Court. They relied on the principle that a taxpayer should not be prejudiced due to administrative delays in the constitution of quasi-judicial bodies. Respondents' Contentions: The respondents conceded that the Tribunal was not constituted. They relied on a circular dated 23.03.2020 issued by the Government of Rajasthan, Finance Department (Tax Division), and proposed that the petition be disposed of with a direction for the petitioner to make payment as per Section 112(8) of the Rajasthan Goods and Services Tax Act, 2017, with liberty to file an appeal within a specified period after the Tribunal's constitution.