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2024 (6) TMI 546 - CALCUTTA HIGH COURT
M/S. NORTH EAST WATER TANK MANUFACTURING PRIVATE LIMITED & ORS. VERSUS UNION OF INDIA
& ORS.
MAT 1 of 2024 with CAN 1 of 2024 CAN 2 of 2024
Dated: - 21-2-2024
Maintainability of writ-petition under Article 226 of the Constitution of India - availability of alternative
remedy provided under Central Goods & Services Tax Act, 2017 - Petitioner challenged the vires of
paragraph 6 of Circular No. 31/05/2018- GST dated 09.02.2018, as amended vide CBI&C Circular No.
169/01/2022-GST dated 12.03.2022, having offended with the provisions contained in Sections 73 and
74 of the CGST Act 2017. - HELD THAT:- Section 107 of the said Act confers power of an appeal against any
decision or order passed under this Act or the State Goods & Services Tax Act or the Union Territory Acts,
Services Acts by the adjudicating authority which does not confer any power or jurisdiction upon such
appellate authority to declare any provision of the statute or the statutory circular to be ultravires to the parent
Act or the Constitution. Such power is vested upon the Constitutional Court and, therefore, it is a paramount
duty of the High Court to decide the said issue and should not have relegated the parties before the statutory
authority which is denuded of such powers.
The impugned order is hereby set aside - the writ-petition is remanded to the Single Bench to decide the
primary relief where the vires of the circulars have been challenged after affording an opportunity of hearing to
the respective parties - petition disposed off by way of remand.
Judgment / Order
HON’BLE HARISH TANDON AND HON’BLE SUPRATIM BHATTACHARYA
For the Appellants : Mr. Arijit Chakraborty, Advocate Mr. Bijay Bikram Das, Advocate.
For the Respondents : Mr. Biswaraj Agarwal, Advocate Mr. Shankar Sarkar, Advocate.
For the State : Mr. Subir Kumar Saha, Learned AGP Mr. Sandip Guha Roy, Advocate.
1. The instant appeal is taken up out of turn on the mentioning of the learned Advocate for the appellants. The
impugned order passed by the Single Bench, which is assailed in the instant Mandamus Appeal, appears to
have been passed refusing to exercise the discretion of entertaining the writ-petition under Article 226 of the
Constitution of India on the ground of alternative remedy provided under Central Goods & Services Tax Act,
2017.
2. The Single Bench was of the view that the moment challenge is made to an order passed by the Authority
under the aforesaid Act, such order is amenable to be challenged before the Appellate Authority under Section
107 of the said Act and, therefore, the moment the Court notices that an efficacious alternative remedy is
available under the statute, the Writ Court should be slow and circumspect in exercising such discretion under
Article 226 of the Constitution of India.
3. It is no doubt true that despite the existence of an alternative statutory remedy provided to an aggrieved
person, there is no fetter on the part of the High Court to entertain the writ-petition under Article 226 of the
Constitution of India. It is not an absolute rule that the powers enshrined under Article 226 of the Constitution
of India upon the High Court, is taken away by virtue of the provision contained in the statute providing the
remedy by way of an appeal. It is not a rule of exclusion but a rule of discretion.
4. The moment the Court refuses to exercise its discretion, the Appellate Court should be slow and
circumspect in interfering with such decision provided the discretion appears to have been exercised
irrationally, unreasonably and against the settled principles of law applicable in this regard. Furthermore, if the
Court refuses to exercise the discretion, the Appellate Court should also be slow in interfering with such
discretionary order.
5. At the first blush, we are not inclined to interfere with the impugned order as the Single Bench was of the
view that there is an alternative efficacious remedy by way of an appeal provided in the said statute but our
attention is drawn to the reliefs claimed in the writ-petition. It appears from the first relief claimed in the writ-
petition that the petitioners apart from challenging several orders in the form of a Circular, have also
challenged the vires of paragraph 6 of Circular No. 31/05/2018- GST dated 09.02.2018, as amended vide
CBI&C Circular No. 169/01/2022-GST dated 12.03.2022, having offended with the provisions contained in
Sections 73 and 74 of the CGST Act 2017.
6. It is no gainsaying that the moment the vires of the Circular or the statutory provision of the subordinate
legislation is challenged, the first and foremost duty, which is required to be discharged, to consider and
decide such issue before embarking the journey of determining other issues.
7. Section 107 of the said Act confers power of an appeal against any decision or order passed under this Act
or the State Goods & Services Tax Act or the Union Territory Acts, Services Acts by the adjudicating authority
which does not, in our opinion, confer any power or jurisdiction upon such appellate authority to declare any
provision of the statute or the statutory circular to be ultravires to the parent Act or the Constitution. Such
power is vested upon the Constitutional Court and, therefore, it is a paramount duty of the High Court to
decide the said issue and should not have relegated the parties before the statutory authority which is
denuded of such powers.
8. In such view of the matter, the impugned order is hereby set aside.
9. The writ-petition is remanded to the Single Bench to decide the primary relief where the vires of the
circulars have been challenged after affording an opportunity of hearing to the respective parties.
10. It goes without saying that the moment the vires of the statutory provision is the subject matter of
challenge in the writ-petition, notice is required to be given to the Deputy Solicitor General in the Circuit Bench
and, therefore, we direct the appellant/petitioner to serve a copy of the instant application upon the Deputy
Solicitor General immediately.
11. Liberty is granted to the parties to pray for listing of the instant writ-petition subject to the convenience of
His Lordship.
12. With these observations, the appeal being MAT 1 of 2024 and the connected applications being CAN 1 of
2024 and CAN 2 of 2024 are disposed of.
