Akshay Chhabra vs. Union Of INDIA And Ors

Facts

The petitioners, Akshay Chhabra and Sunil Kumar Jha, filed writ petitions challenging the constitutional validity of Sections 132(1)(b) and (c) of the CGST Act, and seeking a declaration that power under Section 69 of the CGST Act can only be exercised upon determination of liability and failure to pay. They also sought a writ of mandamus restraining the respondents from filing criminal complaints and taking coercive action. An interim order dated March 11, 2021, was passed directing the petitioners to execute personal bonds, furnish surety, cooperate with the investigation, not tamper with evidence or influence witnesses, and deposit their passports. This interim order has continued for approximately two years.

Held

The Court noted that the petitioners, having not pressed their challenge to the constitutional validity of the CGST Act provisions and having indicated that a complaint has been filed, intended to pursue remedies in the criminal court. The Court acknowledged that the main prayer was for protection from arrest. Citing the decision in Nagpur Cable Operators Association Vs. Commissioner of Police, Nagpur, the Court observed that the petitions ought to have been filed as criminal writ petitions. However, since the petitioners were not pressing the petitions and were only seeking an extension of protective measures, and considering that the petitioners had been at liberty for approximately two years under the interim order which the respondents had not challenged, the Court was inclined to continue the interim order for a period of six weeks to allow the petitioners to take steps in the criminal court. The petitions were disposed of with the interim order continuing for six weeks.

Key Issues

1. Whether Sections 132(1)(b) and (c) of the CGST Act are unconstitutional and in violation of Articles 14 and 21 of the Constitution of India? 2. Whether the power under Section 69 of the CGST Act can only be exercised upon determination of liability and a failure on the part of the assessee to pay such liability? Petitioner's arguments: The petitioners initially sought to challenge the constitutional validity of the aforementioned sections of the CGST Act. However, they later stated that they would not press these challenges. They indicated that a complaint had been filed and that, concerning the liberty of the petitioners, they would take necessary action by approaching the criminal court. They sought an extension of the interim order for this purpose. Revenue/State's arguments: The judgment does not record any specific arguments made by the respondents regarding the constitutional validity of the sections or the exercise of power under Section 69. Their primary engagement appears to be in relation to the interim protection sought by the petitioners.