Shri Balaji Sarkar Building Material Supplier vs. Union Of INDIA

Held

The Court held that all factual and legal grounds raised by the petitioner, including the contention regarding the improper issuance of the show cause notice under Section 74 of the CGST Act, are liable to be raised before the Appellate Authority. The Court noted that the petitioner has a statutory remedy of appeal under Section 107 of the CGST Act. The Court further observed that even a judgment passed by the High Court in a similar matter (W.P. No.8272/2024) could be relied upon by the Appellate Authority. Therefore, the High Court found no reason to entertain the writ petition directly. The ratio decidendi is that statutory remedies must be exhausted before approaching the High Court, even when procedural irregularities are alleged, as the appellate authority is equipped to consider such grounds.

Facts

The petitioner, Shri Balaji Sarkar Building Material Supplier, filed a writ petition before the Madhya Pradesh High Court challenging an order in original dated 21.01.2025 passed by the Superintendent CGST, Tikamgarh. This order imposed a tax liability of Rs. 17,46,262/-, a penalty of Rs. 17,46,262/-, and a further penalty of Rs. 10,000/-. The petitioner contended that the show cause notice issued under Section 74 of the CGST Act on 04.08.2024 was not properly issued. Despite having a statutory remedy of appeal under Section 107 of the CGST Act, the petitioner approached the High Court directly.

Key Issues

1. Whether the petitioner can bypass the statutory appellate remedy under Section 107 of the CGST Act and directly approach the High Court via a writ petition, given the alleged procedural defect in the show cause notice issued under Section 74 of the CGST Act? Petitioner's contention: The petitioner argued that the show cause notice under Section 74 of the CGST Act was not issued in a proper manner, which vitiates the subsequent order. Therefore, the petitioner should not be relegated to the remedy of appeal. Revenue's contention: The respondent (Union of India and others) did not explicitly record arguments in the judgment. However, the Court's disposition implies that the revenue likely contended that the appellate authority is the appropriate forum to address all factual and legal grounds, including the validity of the show cause notice.