Ms Libra Business Private Limited Represented Through Its Director Sri Rahul Kumar Singh vs. Union Of INDIA Represented By Secretary Ministry Of Finance Department Of Revenue

Held

The High Court did not entertain the writ petition. The Court noted that the petitioner had not availed the alternative remedy of appeal before the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) against the Order-in-Original passed by the Adjudicating Authority and had directly approached the High Court. The respondents also raised this as a preliminary objection. The learned counsel for the petitioner then submitted that the writ petition may be allowed to be withdrawn with liberty to pursue the alternative remedy. Considering the existence of an alternative remedy, the Court was not inclined to entertain the writ petition. The writ petition was accordingly disposed of, leaving it open to the petitioner to avail of the alternative remedy, if permissible in law, subject to all limitations. The Court did not decide on the legality or validity of the impugned circular or the subsequent orders and notices.

Facts

M/s Libra Business Private Limited (the petitioner) filed a writ petition before the Jharkhand High Court challenging a Circular No. 1053/2/2017-CX dated March 10, 2017, issued by the Central Board of Indirect Taxes and Customs (CBIC). The petitioner also sought to quash an Order-in-Original dated March 26, 2021, passed by the Principal Commissioner, Central GST & Central Excise, and two Show Cause Notices/Statements dated February 13/19, 2018, and April 5, 2019, issued by the Assistant Commissioner, CGST & CX. The petitioner argued that Paragraph 5.0 of the impugned circular, which excludes preventive/offence related cases from mandatory pre-Show Cause Notice consultation for duty/tax demands above Rs. 50 Lacs, is illegal and contrary to Section 83 of the Finance Act, 1994, read with Section 37B of the Central Excise Act, 1944. The respondents raised a preliminary objection regarding the availability of an alternative remedy.

Key Issues

1. Whether Paragraph 5.0 of Circular No. 1053/2/2017-CX, dated 10.03.2017, to the extent it excludes preventive/offence related cases from mandatory pre-Show Cause Notice consultation for duty/tax demands above Rs. 50 Lacs, is illegal, invalid, irrational, unreasonable, discriminatory, and contrary to Section 83 of the Finance Act, 1994, read with Section 37B of the Central Excise Act, 1944? Petitioner's Contention: The petitioner argued that the impugned circular provision is illegal and irrational as it excludes certain cases from the mandatory pre-Show Cause Notice consultation, which is a procedural safeguard. They relied on Section 83 of the Finance Act, 1994, and Section 37B of the Central Excise Act, 1944. Respondents' Contention: The respondents raised a preliminary objection regarding the maintainability of the writ petition due to the existence of an alternative statutory remedy of appeal before the Customs, Excise and Service Tax Appellate Tribunal (CESTAT). They also referred to a previous order of the High Court in a similar matter concerning the same petitioner.