M/S Chandra Engineers vs. Union Of INDIA

Instant writ petition is filed with the following prayer:-

Learned counsel for the parties are in agreement that this matter be considered at this stage, as a serious question has been raised by learned counsel appearing on behalf of the respondents regarding the maintainability of the present writ petition.

Learned counsel for the petitioner, while placing reliance upon the grounds of the writ petition, has submitted that a search under Section 67(2) of the CGST Act was conducted at the premises of the petitioner and, due to the coercive means adopted by the officers of the respondents, the petitioner was forced to deposit a sum of ₹2 crores on 24.10.2024. He also submitted that the petitioner submitted a detailed representation explaining the genuineness of the transactions with M/s Universal Metals Traders and sought refund of the amount of ₹2 crores, but the same has not been refunded by the respondents. He further submitted that on 15.01.2025, the wife of the petitioner has expired and, after returning from the said bad phase, a reminder representation was submitted by the petitioner, however, the respondents neither decided the representation nor refunded the amount. He also submitted that petitioner has filed DB CWP No.2906/2025 seeking refund of the involuntarily deposited amount of ₹2 crores and,

Learned counsel for the petitioner has challenged the show cause notice (SCN), mainly on the following grounds:- (a) Issue of a single show cause notice for the financial years 2022-23, 2023-24 and 2024-25, i.e., for three consecutive financial years; (b) The power under Section 74 of the CGST Act has been exercised in violation of Rule 142(1A)/(2) of the CGST Rules; (c) Assignment of functions by respondent No.5 through Circular No.3/3/2017 dated 05.07.2017 is without proper authorization under law. Accordingly, respondent Nos.1 to 3 cannot be treated as the "proper officers for the purpose of issuance of summons under Section 70 or adjudication under Section 74 of the CGST Act.

Learned counsel for the petitioner has placed reliance upon the judgment dated 18.12.2023 in the case of Titan Company Limited v. the Joint Commissioner of GST and Central Excise, Salem Commissionerate, Salem and another, Writ Petition No.33164 of 2023 and WMP No.32855 of 2023, decided by the learned Single Judge of the High Court of Judicature at Madras, and submitted that when a representation has been submitted by the petitioner and thereafter a reminder has also been filed, but without considering the same, issuance of the show cause notice "(SCN) is bad in the eye of law and is contrary to all settled norms, as the SCN is a cover-up process

The aforesaid contentions were opposed by learned counsel appearing on behalf of respondent Nos.1, 3 and 5, and submitted that they have already filed a reply to the writ petition and raised a preliminary objection regarding maintainability of the writ petition, which is premature, and that without adjudication, the petitioner cannot approach this Hon’ble Court on the basis of issuance of the SCN. He also submitted that several Hon’ble High Courts have considered Sections 74, 74-A and 122 of the CGST Act with regard to issuance of SCN under the said provisions and, after considering the legality thereof, have approved the authority of the respondents to issue the SCN. He further submitted that a writ petition challenging the SCN is not maintainable, as the respondents are authorized under the law to issue an SCN covering multiple financial years and the same is legally permissible. He further referred the judgment in the case of M/s Mathur Polymers V. Union of India and others, W.P.(C) No.2394 of 2025, passed by the Delhi High Court, and submitted that a consolidated show cause notice is permissible under law.

Learned counsel for the respondents has also referred the judgment in the case of Elesh Agarwal V. Union of India, Writ Tax No.753 of 2023, passed by the Allahabad High Court, and submitted that the SCN was challenged on an analogous ground of

Learned counsel for the respondent has placed reliance upon the judgment in the case of M/s Mathur Polymer v. Union of India, (supra) and submitted that the said judgment has been approved by the Hon’ble Supreme Court in SLP(C) Diary No.50279/2025, titled as M/s Mathur Polymer versus Union of India and others, as said SLP was dismissed. He also referred the judgment in the case of Ambika Traders through its Proprietor Gaurav Gupta versus Additional Commissioner, Adjudication, DGGSTI, CGST, Delhi North, W.P.(C) No.4853/2025, passed by the Delhi High Court and approved by the Hon’ble Supreme Court while dismissing SLP(C) No.22374/2025 on 01.09.2025. 9. Learned counsel for respondents also placed reliance upon the judgment in the case of Elesh Agarwal versus Union of India, (supra); Sonali Rzoy versus State of West Bengal, WPA No.5013/2025, passed by the Calcutta High Court; Yasho Industries versus Union of India, reported in 2021 (6) T.R. 4343, passed by the Gujarat High Court and further approved by

Heard learned counsel for the parties and perused the material placed on record, along with the rreply and the judgments referred by learned counsel appearing for both the parties.

Admittedly, the present petitioner has filed DB Civil Writ Petition No.2906/2025 with a prayer to refund/return the amount deposited in an involuntarily manner on 24.10.2024, which is pending before this Court. The copies of the orders dated 03.12.2025, 19.05.2025 and 24.03.2025 have been placed on record. The petitioner has filed the present writ petition to challenge the action pursuant to a search proceeding conducted on 22.10.2024 and concluded on 23.10.2024. 13. The petitioner has filed this writ petition only after issuance of the SCN dated 01.12.2025, which was issued for consolidated three financial years, i.e., 2022-2023, 2023-2024 and 2024-2025. The primary three grounds relied upon by the petitioner and replied by the respondents in their reply have been considered by us. The respondents have raised a preliminary objection regarding

In the case of M/s Mathur Polymers versus Union of India (supra), a Division Bench of the Delhi High Court has considered various judgments, including Titan Company Limited versus CGST and Central Excise (supra), and Ambika Traders versus Additional Commissioner, (supra), and has held that the legislature is conscious of the fact that, insofar as wrongfully availed ITC is concerned, a notice can relate to a period and need not necessarily to a specific financial year. The statutory scheme and the legislative history of the GST Act indicate that the availment of input tax credit (ITC) and the transactions may be separate over several years, thus, issuance of a consolidated notice for multiple financial years would be permissible and tenable. The ratio clearly indicate that an SCN for multiple financial years can be issued and the same is legally permissible, therefore, an SCN cannot be challenged on the ground mentioned by learned counsel for the petitioner. This judgment was approved by the Hon’ble Supreme Court, as the SLP was dismissed on 07.11.2025. 15. In the case of Ambika Traders, through its Proprietor Gaurav Gupta versus Additional Commissioner (supra), a Coordinate Bench of the Delhi High Court considered an SCN which was challenged on the alleged violation of statutory

In the case of Fomento Resorts and Hotels Limited versus Union of India (supra), a Coordinate Bench of the Bombay High Court considered the power of assignment of functions of the ‘proper officer’ upon Centralized Tax Officers and the issuance of SCN. In the said case, Circular No.3/3/2017-GST dated 05.07.2017, (referred hereinabove), was also challenged. After considering the entire submissions and the legal position, the writ petition was dismissed.

The issue was further considered by a Coordinate Bench of the Delhi High Court in the case of Lovelesh Singhal versus Central Board of Indirect Taxes and Customs and others, (supra). After considering the challenge to Circular No.3/3/2017- GST dated 05.07.2017 on identical grounds, the writ petition was disposed of without quashing the circular.

The judgments referred by learned counsel for the petitioner have clearly been considered by the Coordinate Benches of the Delhi High Court and the Bombay High Court. After considering the aforesaid position of law, the Delhi High Court and the Bombay High Court have declined to issue a writ of mandamus where the aforesaid circular dated 05.07.2017 was under challenge and also a consolidated SCN for multiple financial years was under challenge on various grounds.

The grounds referred in the present writ petition have already been considered in the judgments referred hereinabove. Upon consideration of the said grounds, Coordinate Benches of multiple High Courts have declined to interfere, particularly when the petitioner is having an alternative and efficacious remedy available under the CGST Act. Therefore, the present writ petition has been filed only to stall the proceedings pursuant to the SCN and there is no ground for issuance of a writ in favour of the petitioner. The writ petition is not entertainable, as the petitioner is having alternative and efficacious remedy under the CGST Act, 2017. 20. In view of the discussion made hereinabove, the DB Civil Writ Petition is hereby dismissed, along with pending application(s), if any.

The interim order passed by this Court stands vacated. (ASHOK KUMAR JAIN),J (INDERJEET SINGH),J 38/MONU KAMRA