Court Upholds Statutory Remedy of Appeal, Denies Exemption from Pre-Deposit Requirement
In a significant ruling, the Delhi High Court has dismissed a writ petition filed by M/s DS Farbication, challenging the cancellation of its GST registration on grounds of non-existence and alleged wrongful availing of Input Tax Credit. The division bench comprising Justice Anil Kshetarpal and Justice Shail Jain held that the petitioner should pursue the statutory remedy of appeal under Section 107 of the Central Goods and Services Tax Act, 2017, rather than seeking judicial intervention through a writ petition.
The court noted that a Show Cause Notice had been issued to M/s DS Farbication, offering an opportunity to respond and attend a personal hearing, neither of which was availed by the petitioner. The bench emphasized that whether the opportunity provided was adequate is a factual matter best examined by the Appellate Authority.
The petitioner's counsel argued that the principles of natural justice were violated, claiming the order was passed ex parte. However, the court found that the procedural requirements were met, as the petitioner was given due notice and opportunity which it chose not to utilize.
Furthermore, the petitioner sought exemption from the statutory pre-deposit requirement mandated under the Act for filing an appeal. The court clarified that the Central Goods and Services Tax Act, 2017, does not provide any provision for such an exemption, thereby denying the request.
The judgment underscores the judiciary's stance on adhering to statutory remedies before approaching the courts and reiterates that matters involving factual disputes should be addressed by the designated appellate bodies. As such, the writ petition along with any pending applications was disposed of, directing the petitioner to consider the alternative remedy of appeal as per the legal provisions.
Bottom line:-
Writ Petition challenging cancellation of GST registration due to non-existence of firm and alleged wrongful availing of Input Tax Credit - Principles of natural justice claimed to be violated - Court held that statutory remedy of appeal under Section 107 of the Central Goods and Services Tax Act, 2017 is available to the Petitioner.
Statutory provision(s): Central Goods and Services Tax Act, 2017, Section 107
