Ms Novelty Associates Private Limited vs. The Union Of INDIA And Others

Held

The Court held that since proceedings had been initiated, orders quantifying the petitioner's liability had been passed, and such orders had been affirmed in appeal, the petitioner ought to exhaust the remedies available under the statute before approaching the High Court. The Court specifically observed that the objection taken by the petitioner regarding the validity of notice and invocation of jurisdiction under Section 74 would be specifically dealt with by the Second Appellate Authority. Therefore, the writ petition was dismissed, with a direction that if an appeal is filed within two weeks from the date of the order, it shall be entertained without objection regarding limitation.

Facts

The petitioner, M/s Novelty Associates Private Ltd, is challenging an order passed in FORM DRC-07 dated 03.10.2024 and a consequential order-in-appeal dated 30.09.2025. The petitioner contends that the proceedings were initiated without proper notice and that jurisdiction under Section 74 of the Goods and Services Tax Act, 2017, was not validly invoked. The Revenue argued that the objection regarding notice and jurisdiction could be addressed by the Second Appellate Authority under Section 112 of the Act. The High Court noted that proceedings had been initiated and orders passed, and that the appellate order had been affirmed. Consequently, the Court directed the petitioner to exhaust statutory remedies before approaching the High Court.

Key Issues

1. Whether the initiation of proceedings under Section 74 of the Goods and Services Tax Act, 2017, was valid without proper notice to the petitioner? 2. Whether the jurisdiction under Section 74 of the Goods and Services Tax Act, 2017, was validly invoked by the revenue authorities? Petitioner's Contention: The petitioner argued that the proceedings were not backed by any proper notice and that jurisdiction under Section 74 of the Act of 2017 was not validly invoked. Reliance was placed on the Supreme Court judgment in M/s G. R. Infra Projects Limited Ratlam v. The State of Madhya Pradesh and Others. Revenue's Contention: The Revenue stated that the objection taken by the petitioner regarding notice and jurisdiction could be examined by the Second Appellate Authority while exercising its jurisdiction under Section 112 of the Act of 2017.