Smt Usha W/O Shri Tarun vs. Union Of INDIA

Held

The Court held that the writ petition is not maintainable due to the availability of an alternative and efficacious statutory remedy of appeal under Section 107 of the CGST/RGST Act, 2017. The Court reasoned that the CGST Act is a self-contained code with a robust statutory mechanism for grievance redressal. The impugned order of confiscation is an adjudicatory order squarely appealable before the designated Appellate Authority. The extraordinary writ jurisdiction under Article 226 is not intended to circumvent the statutory appellate hierarchy. The exceptions for invoking writ jurisdiction, such as absolute lack of jurisdiction, violation of fundamental rights, or gross violation of natural justice, were found to be absent. The petitioner was served a show-cause notice, submitted a reply, and was afforded a personal hearing, rendering the plea of breach of natural justice meritless. The controversy involves disputed questions of fact regarding the nature of goods, travel time, and electronic data, which a writ court cannot adjudicate as a fact-finding forum. The Court emphasized that the writ jurisdiction should not be used to bypass statutory appellate frameworks, especially in taxation matters. The petitioner was granted liberty to approach the Appellate Authority, and it was directed that the appeal be adjudicated on its merits. The observations made were not to prejudice either party.

Facts

The petitioner, Smt. Usha, proprietor of M/s Madhav Cotton & Oil Mill, challenged a confiscation order dated 01.10.2026 (FORM GST MOV-11) and a demand for bank guarantee of Rs. 42,05,898/- dated 21.09.2026. The goods, declared as "Soyabean Refined Oil" under a tax invoice and e-way bill dated 27.08.2026, were intercepted by State Tax authorities at Alwar on the same date. Physical verification on 02.09.2026 revealed the goods were "Mustard Oil" (HSN 1514) instead of "Soyabean Refined Oil" (HSN 15079010), and the driver had absconded. A show-cause notice for confiscation was issued. The petitioner had previously approached the High Court in D.B. Civil Writ Petition No. 18392/2026, where the court directed the release of the vehicle and goods upon furnishing a bank guarantee, keeping pending proceedings unprejudiced. The present petition assails the final confiscation order.

Key Issues

1. Whether the impugned orders are arbitrary, disproportionate, and suffer from jurisdictional error, warranting invocation of writ jurisdiction bypassing the statutory appellate remedy under Section 107 of the CGST/RGST Act, 2017? Petitioner's arguments: The fine imposed exceeds statutory ceilings under the first proviso to Section 130(2) of the CGST/RGST Act, 2017, and the penalty is levied twice. The adjudicating authority relies on surmises regarding transit time and absence of RFID/Toll data, and the CGST Act does not prescribe a mandatory route. The appeal under Section 107 is not efficacious due to alleged excess of jurisdiction, violation of principles of natural justice, and the perishable nature of goods, citing Whirlpool Corporation v. Registrar of Trade Marks and Radha Krishan Industries v. State of Himachal Pradesh. Respondents' arguments: The writ petition is maintainable only if there is an alternative, efficacious statutory remedy of appeal under Section 107 of the CGST/RGST Act, 2017. The petitioner's conduct and the driver fleeing the scene, coupled with the definitive proof of mismatched goods, indicate serious evasion. The confiscation order is a detailed speaking order after due process, negating the plea of violation of natural justice. The dispute involves complex questions of fact (chemical nature of oil, travel time, RFID/toll data) that are best adjudicated by the Appellate Authority under Section 107.