Introduction
The Hon’ble High Court of Kerala (‘HC’) recently rendered a judgement in the case of Adam Traders v. Deputy Commissioner, Taxpayer Services Division[i], which has elucidated the judiciary’s circumscribed role concerning appeals under the provisions of the Central Goods and Services Tax Act, 2017 (‘CGST Act’) and State Goods and Services Tax Act, 2017 (‘SGST Act’). This decision underscores the significance of adhering to the statutory appellate process delineated under s. 107 of the CGST/SGST Acts, marking a pivotal moment in the interpretation of jurisdictional boundaries within the realm of tax litigation.
Brief Facts
The present case emanates from the writ petition filed by the Petitioner under a. 226 of the Constitution of India, 1949 (‘Constitution’) against the Respondent. The Petitioner challenged the rejection of its GST returns filed Form GSTR-3B for the period April 2017 to March 2018 by the GST department.
The Petitioner in the present case sought retrieval and examination of the records leading to the rejection of its GST returns and quashing of the same, highlighting a procedural challenge against the administrative decision-making process. The Petitioner further sought a declaration that its GSTR-3B returns were compliant with s. 16(2)(c) of the CGST Act and thereby devoid of any contravention. Further, permission to amend and resubmit GSTR-3B entries for the period from April 2017 to March 2018 was also sought in case there was a need to correct any errors.
Held
The HC dismissed the petition filed by the Petitioner on the ground that it was misconceived and advised the Petitioner to explore other available remedies against the impugned assessment order. The HC noted that it did not serve as an appellate authority for appeals against assessment orders made under the provisions of the CGST and SGST Acts. A specific provision exists under s. 107 of the CGST/SGST Acts for such appeals. Consequently, the HC concluded that, under a. 227 of the Constitution, its jurisdiction is limited to examining only whether the order is without jurisdiction, involves procedural impropriety, or contains an error apparent on the face of the record, and none of these conditions were found to be present in this case.
Analysis
In the adjudicated matter, the HC meticulously underscored the doctrine of alternative remedy, asserting that petitions under a. 226 of the Constitution will not be entertained if an effective statutory mechanism is available to the aggrieved party. Specifically, in this instance, the CGST and the SGST Acts provide a statutory framework for redressing grievances.
Furthermore, the HC’s stance is contextualized within the broader judicial landscape, wherein the Hon’ble Supreme Court, as seen in CIT v. Chhabil Dass Agarwal[ii], has recognized exceptions to the rule of alternative remedies. These exceptions include instances where the remedy available under the statute is not effective but only mere formality with no substantial relief, where the statutory authority failed to act in conformity with the enacted laws, or the statutory authority has breached fundamental principles of judicial procedure or natural justice, or where the statutory authority resorted to invoke repealed provisions.
However, in the present case, the HC highlighted its limited jurisdictional scope under a. 227 and strictly adhered to the principle of the rule of alternative remedy by ruling that when a statutory forum is created by law for the redressal of grievances, the same negates the necessity for judicial intervention through writ petitions. This adherence to statutory processes reinforces the judiciary’s commitment to uphold the legislative framework, ensuring that the established appellate mechanisms under the CGST/SGST Acts are utilized prior to resorting to constitutional remedies.
End Notes:
[i] 2024 SCC OnLine Ker 657.
[ii] (2014) 1 SCC 603.
Authored by Kushagra Gahlot, Advocate at Metalegal Advocates. The views expressed are personal and do not constitute legal opinion.