2025 (7) TMI 1328 - HC - GST

Maintainability of petition - availability of alternative remedy of appeal - Challenge to order passed u/s 129(3) of the WBGST/CGST Act 2017by proper officer which is an appealable order - HELD THAT - No attempt appears to have been made at any stage to seek release of the vehicle and the goods by invoking the provisions of Section 129(1)(a) of the said Act by making payment in terms thereof. This apart the petitioner has also not cooperated with the authorities and has also not made available the requisite documents. As far the question as to whether having regard to Explanation-2 of Rule 138 of the said Rules the value of the goods are to be determined on the basis of disclosure made in the invoice is concerned it is noticed that in this case there has been short recording of the weight of the goods on the invoice. The conduct of the petitioner in not appropriately recording the correct weight does not appear to be proper. Though the same has been challenged the same cannot be considered in an application under Article 226 of the Constitution of India. This apart though the writ petition was filed citing extreme urgency it now appears that this Court was not kept informed with regard to the actual state of affairs while mentioning this matter. This is an unfortunate trend to say the least. There could not have any urgency in the matter especially having regard to the fact that no attempt was made by the petitioner to seek release of the vehicle and the goods by making payment of penalty in terms of Section 129(1)(a) of the said Act. Having regard to the alternative remedy available the writ petition ordinarily ought not to be entertained. Petition disposed off.

Summary

ISSUES:

Whether a writ petition under Article 226 is maintainable against an order passed under Section 129(3) of the CGST/WBGST Act, 2017, when an alternative remedy of appeal under Section 107 of the Act is available.Whether the petitioner is entitled to release of detained goods and vehicle without payment of penalty under Section 129(1)(a) of the CGST/WBGST Act, 2017.Whether the petitioner, as the deemed owner named in the e-way bill, is required to prove ownership of the goods detained.Whether the proper officer can re-determine tax liability contrary to Explanation 2 of Rule 138(2) of the CGST/WBGST Rules, 2017, in proceedings under Section 129.Whether the writ court can examine the correctness of weight discrepancy and related documentary evidence in a writ petition under Article 226.Whether extreme urgency justifies entertaining the writ petition despite non-compliance with statutory procedures for release of goods.

RULINGS / HOLDINGS:

The writ petition challenging the order under Section 129(3) of the Act is not maintainable as the petitioner has an alternative remedy of appeal under Section 107 of the Act, and the writ court ordinarily ought not to entertain such petitions.The petitioner was required to seek release of the detained goods and vehicle by making payment of penalty under Section 129(1)(a) of the Act; failure to do so disentitles the petitioner from claiming release without penalty.Being the deemed owner as per the e-way bill does not absolve the petitioner from cooperating with authorities or furnishing requisite documents to establish ownership; the petitioner's refusal to provide documents cannot be excused in writ proceedings.The proper officer's re-determination of tax liability contrary to Explanation 2 of Rule 138(2) of the Rules cannot be examined in a writ petition under Article 226, especially when an alternative remedy exists.The writ court will not entertain challenges to factual findings such as weight discrepancies or documentary evidence in writ jurisdiction under Article 226 where statutory remedies are available.Allegations of extreme urgency are not sufficient to bypass statutory procedures or justify writ relief when the petitioner has not complied with the prescribed mechanism for release of goods.

RATIONALE:

The Court applied the statutory framework under the CGST/WBGST Act, 2017, specifically Sections 129(1)(a), 129(3), and 107, and the CGST/WBGST Rules, 2017, Rule 138(2) Explanation 2, emphasizing the availability of an efficacious alternative remedy of appeal which precludes writ jurisdiction.The Court underscored the principle that writ jurisdiction under Article 226 is discretionary and not a substitute for statutory appellate remedies, particularly in tax matters involving detailed factual and documentary scrutiny.The Court noted the petitioner's failure to invoke the statutory mechanism for release of goods by payment of penalty as required under Section 129(1)(a), thereby negating any claim of urgency or entitlement to immediate relief.The Court refrained from delving into the merits of the weight discrepancy and tax liability issues, holding that such factual and legal disputes are to be addressed through the prescribed appellate process rather than writ proceedings.The Court's directions allowing release of goods upon compliance with penalty payment and submission of purchase invoices reflect a pragmatic approach balancing statutory compliance and the perishable nature of goods, without prejudice to appellate rights.