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2024 (6) TMI 546 - HC - GSTMaintainability 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.
Issues:
1. Refusal to exercise discretion under Article 226 of the Constitution of India due to alternative remedy under Central Goods & Services Tax Act, 2017. 2. Challenge of vires of Circular No. 31/05/2018-GST and statutory provisions. 3. Jurisdiction of High Court to decide on vires of circulars and statutory provisions. Analysis: The High Court of Calcutta heard an appeal where the Single Bench had refused to exercise discretion under Article 226 of the Constitution of India, citing the availability of an alternative remedy under the Central Goods & Services Tax Act, 2017. The Single Bench believed that challenging an order under the Act should be done through the Appellate Authority, as per Section 107 of the Act. However, the High Court clarified that despite the existence of an alternative remedy, the High Court retains the discretion to entertain writ petitions under Article 226. It emphasized that this discretion is not absolute but a matter of judicial choice. The High Court highlighted that if the Court decides not to exercise its discretion, the Appellate Court should be cautious in interfering unless the decision is irrational or against established legal principles. In this case, the High Court was initially hesitant to intervene but noted that the writ petition challenged the vires of Circular No. 31/05/2018-GST and statutory provisions. When the validity of a circular or statutory provision is challenged, it is crucial to address this issue before delving into other matters. Section 107 of the Central Goods & Services Tax Act allows for appeals against decisions or orders under the Act but does not empower the appellate authority to declare statutory provisions or circulars ultra vires to the parent Act or the Constitution. This power rests with the Constitutional Court, emphasizing the High Court's duty to decide on such issues. Consequently, the High Court set aside the impugned order and remanded the writ petition to the Single Bench to address the challenge to the vires of the circulars after providing a hearing to the parties involved. Moreover, the Court directed the appellant to serve a copy of the application to the Deputy Solicitor General when challenging the vires of statutory provisions. The parties were granted liberty to request listing of the writ petition based on the convenience of the Court. The appeal and connected applications were disposed of with these directions, emphasizing the importance of addressing challenges to statutory provisions and circulars within the appropriate legal framework.
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