Bibhuti Bhushan Singh vs. Union Of INDIA, Through Chairman, Central Board Of Indirect Taxes

Held

The Court held that while the existence of an alternate remedy does not automatically bar the exercise of extraordinary jurisdiction under Article 226, it is generally a self-imposed limitation that parties must exhaust statutory remedies. The Court noted that the issues of limitation and whether the services were exempted involve mixed questions of fact and law, best adjudicated by specialized authorities under the Act. The Court rejected the argument that the 7.5% pre-deposit requirement renders the statutory remedy inefficacious, especially given the demand amount. Citing Supreme Court precedents like *The State of Maharashtra and Others Vs. Greatship (India) Limited* and *Thansingh Nathmal Vs. Superintendent of Taxes, Dhubri and others*, the Court emphasized that Article 226 is not meant to circumvent statutory procedures and that writ petitions are not to be used to bypass alternative remedies unless in exceptional circumstances like the vires of a statute being questioned or significant public injury. The Court, referencing *Oberoi Constructions Ltd. Vrs. the Union of India & Ors.*, declined to entertain the writ petition. Instead, the Court directed the petitioner to pursue the alternative remedy of appeal. If the petitioner files an appeal within six weeks from the date of the order, complying with all pre-conditions including pre-deposit, the appellate authority must consider the appeal on merits without considering the issue of limitation. All contentions on merits were left open.

Facts

The petitioner, Bibhuti Bhushan Singh, proprietor of M/s Bibhuti Bhushan Singh, challenged an Order-in-Original dated 31.10.2023, which confirmed a demand of Rs. 4,89,582/- along with interest and penalty. The petitioner contended that the Order-in-Original was never served. The respondents stated that the order was dispatched to the petitioner's address but was returned unserved. The respondents offered to grant the petitioner reasonable time to file an appeal if limitation was an issue. The petitioner argued against relegating them to the appellate remedy, citing that the show-cause notice was barred by limitation, the order was passed beyond the prescribed period, and the services rendered were exempted under a 2012 notification. The petitioner also highlighted the pre-deposit requirement for appeal as a barrier.

Key Issues

1. Whether the High Court should entertain a writ petition under Article 226 of the Constitution bypassing the statutory remedy of appeal, when the impugned order is alleged to be without jurisdiction due to limitation, passed beyond prescribed periods, and concerning exempted services. Petitioner's Arguments: - The impugned order is ex facie without jurisdiction as the show-cause notice was barred by limitation and the order was made beyond the prescribed period. - The services rendered by the petitioner are clearly exempted under the 2012 notification. - An appeal is not an efficacious remedy due to the mandatory pre-deposit of 7.5% of the tax demand. - Relied on *Committee of Management and Another Vrs. Vice-Chancellor and Others* to argue that superior courts should not refuse jurisdiction when an order is passed without jurisdiction or in violation of natural justice. Respondents' Arguments: - The extended period of limitation was invoked. - There was no delay in passing the impugned order. - No taxes were levied on exempted services. - Relied on Supreme Court precedents emphasizing exhaustion of alternative remedies.