2025 (2) TMI 65 - HC - GST

Maintainability of petition - availability of alternative remedy - Challenge to SCN - requirement to issue separate show cause notice for two separate years as they constitute difference cause of action - HELD THAT - It is seen that the petitioner is having an alternative and efficacious remedy under Section 107 of the Central Goods and Services Tax Act 2017. However it is seen that single notice has been issued to the petitioner in respect of short payment of GST in respect of two financial years which is erroneous. The writ petition is hereby dismissed reserving liberty to the petitioner to approach appropriate appellate authority in the manner known to law and if an appeal were to be filed the petitioner would be entitled to the benefit of Section 14 of the Limitation Act 1963.

Summary

In the case before the Karnataka High Court, presided over by Justice M.I. Arun, the petitioner challenged a show cause notice issued under Section 73(1) of the Central Goods and Services Tax Act, 2017/Karnataka Goods and Services Tax Act, 2017. The notice pertained to alleged short payment of GST for the financial years 2019-20 and 2020-21. The petitioner argued that separate notices should have been issued for each financial year, as they represent different causes of action.The court acknowledged that the petitioner has an "alternative and efficacious remedy under Section 107" of the Act, which allows for appeal. Despite recognizing the procedural error of a single notice covering two years, the court dismissed the writ petition, granting the petitioner the liberty to pursue an appeal through the appropriate channels. The petitioner was also granted the benefit of Section 14 of the Limitation Act, 1963, should an appeal be filed.Furthermore, the court directed the respondents not to take any precipitative action against the petitioner for thirty days, allowing time to seek appellate review. The appellate authority is instructed to consider the appeal independently of the court's observations.