Court emphasizes availability of alternative remedy under Section 107 of CGST Act and refrains from exercising writ jurisdiction in dispute involving factual allegations.
In a significant ruling dated September 9, 2026, the Division Bench of the Delhi High Court, comprising Justices Anil Kshetarpal and Rajneesh Kumar Gupta, refused to entertain a writ petition filed by Adhvik Polychem challenging the rejection of its application for cancellation of Goods and Services Tax (GST) registration. The court underscored the principle that constitutional courts should generally refrain from exercising writ jurisdiction under Article 226 of the Constitution of India when an effective alternative statutory remedy is available - in this case, the appeal remedy under Section 107 of the Central Goods and Services Tax Act, 2017 (CGST Act).
The petitioner sought a writ in the nature of mandamus to quash the order dated June 9, 2026, whereby its cancellation application was rejected by the Assistant Commissioner of GSTO Ward 58. The petitioner's counsel acknowledged the existence of the alternative remedy but urged the court to intervene due to alleged harassment arising from repeated show cause notices (SCNs) issued against the firm.
The court noted that the impugned order was appealable under Section 107 of the CGST Act and that the writ jurisdiction ought to be exercised sparingly in cases requiring detailed examination of disputed facts and evidentiary material. The petitioner had been issued multiple SCNs on grounds including submission of allegedly fake documents, doubtful identity and address of the proprietor, non-appearance at hearings, excess Input Tax Credit (ITC) claims, failure to discharge tax liabilities, and non-response to departmental notices.
Furthermore, the respondent highlighted the firm's increasing turnover over the years, which underscored the gravity of the allegations. The court emphasized that such complex factual disputes are best addressed by the specialized appellate authority designated under the CGST Act.
Without expressing any view on the merits of the case, the High Court declined to interfere with the departmental order and directed the petitioner to approach the appellate forum under Section 107. The court also clarified that the appellate authority should decide the matter independently, uninfluenced by observations made during the writ proceedings.
This judgment reiterates the judiciary's cautious approach in tax matters where alternative remedies exist and reinforces the importance of following prescribed statutory procedures before seeking constitutional relief.
Bottom Line:
Constitutional Courts under Article 226 of the Constitution may refrain from exercising jurisdiction where an alternative remedy is available, particularly when the dispute involves examination of disputed facts and allegations.
Statutory provision(s):
Central Goods and Services Tax Act, 2017 Section 107, Section 74
Adhvik Polychem v. Assistant Commissioner GSTO Ward 58, (Delhi)(DB) : Law Finder Doc Id # 2978388
