2022 (4) TMI 52 - HC - GST

Maintainability of petition - availability of alternative remedy of appeal - reversal of excess unutilised input tax credit - no opportunity of personal hearing was given - HELD THAT - It has been repeatedly held by this Court that, whenever there is an appeal remedy under the tax statute, that appeal remedy shall be first exhausted, without which, if at all the assessee or dealer comes before this Court invoking Article 226 of the Constitution of India , that can be entertained only under three circumstances - i. Violation of principles of natural justice, ii. Violation of statutory provisions, and iii. For want of jurisdiction. In the present case, none of the above three circumstances is available for invoking the extraordinary jurisdiction of this Court under Article 226 of the Constitution of India, as there has been a notice issued before passing the impugned order by the Revenue and an opportunity of personal hearing was also given. This chance since has not been utilised by the petitioner, he cannot make a cry over the passing of the impugned order and therefore, the impugned order can be assailed by the petitioner on merits before the appellate authority. This writ petition is liable to be dismissed and is accordingly dismissed.

Summary

Issues:
Challenge to order in Form GST DRC-07 dated 07.12.2021 for alleged excessive claim of unavailed input tax credit.

Analysis:
The petitioner, a dealer under the TNVAT Act regime, transitioned to the TNGST Act after the GST regime's implementation. The Revenue alleged that the petitioner had excessively claimed unavailed input tax credit for the period 2017-18, leading to a discrepancy of ?22,20,247. Despite a notice issued on 16.10.2019 and an opportunity for a personal hearing, the petitioner did not respond. Consequently, the impugned order was issued on 07.12.2021, directing the petitioner to pay ?33,25,707.

The petitioner argued that no personal hearing opportunity was provided despite submitting relevant documents. The respondent contended that the notice was issued for incorrect input tax credit availment, which was not in the petitioner's electronic credit ledger. The Revenue defended the order, stating that principles of natural justice were not violated, and the petitioner could appeal the decision instead of filing a writ petition.

The court emphasized that appeal remedies under tax statutes must be exhausted before seeking relief under Article 226 of the Constitution. Since none of the exceptional circumstances (violation of natural justice, statutory provisions, or lack of jurisdiction) existed in this case, the petitioner's writ petition was dismissed. The court ruled that the petitioner could challenge the impugned order before the appellate authority on its merits.

In conclusion, the writ petition was dismissed without costs, allowing the petitioner to pursue the matter before the appellate authority. The court highlighted the importance of exhausting appeal remedies before resorting to constitutional remedies, emphasizing adherence to statutory procedures in tax matters.