M/S Tnh Merchantile Private Limited Through Sh. Najmuddin Rokerya vs. Union Of INDIA Through Ministry Of Finance Department Of Revenue

Held

The Court held that the Indore Bench has territorial jurisdiction to entertain the writ petition. It reasoned that the petitioner has GST registration and a place of business in Indore, and the search and material handling occurred in Indore. Therefore, the location of the assessing authority in Bhopal does not divest the Indore Bench of jurisdiction, especially in light of the doctrine of forum conveniens and the Division Bench's ruling in *Shrigovind Niranjan*. Regarding maintainability, the Court acknowledged that writ petitions are maintainable in cases of lack of jurisdiction, challenge to vires, or total violation of natural justice. However, it found that the petitioner's claim of violation of natural justice, specifically the denial of cross-examination, was unsubstantiated as the petitioner failed to demonstrate when the request for cross-examination was made or the prejudice caused. The Court emphasized that the appellate authority is competent to examine such issues. Citing the Supreme Court's decision in *State of Maharashtra & Others v/s Greatship (India) Limited*, the Court held that the High Court erred in entertaining the writ petition when an alternative statutory remedy of appeal was available. The Court stated that judicial prudence dictates refraining from exercising writ jurisdiction when an alternate remedy exists, especially when there are factual disputes and no valid reasons to bypass the statutory appeal. Consequently, all writ petitions were dismissed, with liberty granted to the petitioners to approach the appellate authority.

Facts

The petitioners, M/s Goyal Trading Co. and others, filed writ petitions challenging an Order in Original (OIO) dated December 19, 2024, passed by the Additional Commissioner, Central Goods & Service Tax, Bhopal. This order pertained to tax periods 2017-18 to 2018-19 and imposed recovery of Input Tax Credit (ITC), interest, and penalty. The OIO followed an investigation by the DGGI, Bhopal Unit, into M/s R.A. Enterprises for allegedly availing and passing on fake/bogus ITC amounting to Rs. 1,39,03,814/-. Show-cause notices were issued to 18 noticees, including the petitioners, under Section 74 and Section 122(1)(ii) of the CGST Act read with Section 20 of the IGST Act. The petitioners approached the High Court instead of filing an appeal under Section 107 of the CGST Act, citing violations of natural justice.

Key Issues

1. Whether the writ petition is maintainable before the Indore Bench of the High Court, considering the petitioner's registration and place of business are in Indore, but the assessing authority is in Bhopal? (Question of territorial jurisdiction). 2. Whether the writ petition is maintainable despite the availability of an efficacious statutory remedy of appeal under Section 107 of the CGST Act? (Question of maintainability due to alternative remedy). Petitioner's Arguments: The petitioners contended that the writ petition is maintainable as the OIO was passed in gross violation of the principles of natural justice. Specifically, they argued that the respondent authority denied them the opportunity to cross-examine witnesses and failed to consider their submissions and grounds. They also argued that a common notice was issued for different financial years. They relied on several judgments, including *Bharat Mint & Allied Chemicals v/s Commissioner of Commercial Tax* and *Andaman Timber Industries v/s Commissioner of Central Excise, Kolkata-II*, to support the maintainability of writ petitions against an Order in Original. Respondents' Arguments: The respondents argued that the writ petition is not maintainable due to the availability of an efficacious statutory remedy of appeal. They contended that the petitioners approached the High Court to avoid the pre-deposit requirement of 10% of the tax under recovery. They relied on Apex Court judgments in *State of Maharashtra & Others v/s Greatship (India) Limited* and a Division Bench judgment of the same High Court in *Shrigovind Niranjan & Others v/s The State of Madhya Pradesh & Others*.