Writs Must Show Exceptional Cause to Bypass GST Alternate Remedy: Chhattisgarh HC clarifies Difference b/w ‘Entertainability’ & ‘Maintainability’ [Read Order]

The Chhattisgarh High Court has reiterated the judicial principle that while writ petitions under Article 226 of the Constitution are legally maintainable even in the presence of an alternate remedy under Goods and Services Tax ( GST ), they must demonstrate exceptional circumstances to warrant the court's discretionary intervention.

The petition was filed by Mayasheel Retail India Limited, which challenged a GST demand order without first exhausting the statutory appellate remedy under Section 107 of the CGST Act, 2017.

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The petitioner contended that the GST demand order dated 11.01.2021, along with a subsequent recovery notice, was issued without due process, including the absence of a proper show cause notice and personal hearing.

They argued that the order was served improperly and that the same issues were later reopened and resolved in their favor during scrutiny proceedings in 2024. Despite this, the tax department did not withdraw the earlier demand, prompting the writ petition.

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The State, however, opposed the writ, pointing out that the petitioner had bypassed the statutory appellate mechanism and failed to disclose this in the petition. The State relied on the doctrine of alternative remedy, asserting that the writ should not be entertained unless the petitioner had made out an exceptional case.

Justice Ravindra Kumar Agrawal, delivered well-established legal principles distinguishing between the maintainability and entertainability of writ petitions.

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The court quoted Supreme Court precedents including Godrej Sara Lee Ltd. v. Excise and Taxation Officer and Commercial Steel Ltd. and explained that while a writ may be maintainable despite an alternate remedy, the discretion to entertain it lies entirely with the High Court. This discretion is generally exercised only in cases involving breaches of natural justice, lack of jurisdiction, or manifest illegality.

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The bench observed that “Availability of an alternative remedy does not operate as an absolute bar to the 'maintainability' of a writ petition. It has, thus, been observed that 'entertainability' and 'maintainability' of a writ petition are distinct concepts. While an objection to the 'maintainability' goes to the root of the matter, the question of 'entertainability' is entirely within the realm of discretion of the High Courts. Being otherwise maintainable, it has been enunciated that dismissal of a writ petition by a High Court on the ground that the petitioner has not availed the alternative remedy without examining the aspect of whether an exceptional case has been made out for such entertainment would not be proper.”

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The Court held that the writ petition is maintainable, however cannot be entertained as petitioner failed to make out any such exceptional circumstance. Since the CGST Act provides a specific remedy under Section 107, the High Court declined to entertain the writ petition, emphasizing that writ jurisdiction should not become a substitute for statutory appellate procedures.

However, the Court clarified that its refusal to entertain the petition would not preclude the petitioner from approaching the appellate authority. It also directed that if the petitioner files an appeal, the appellate authority must take into account the time spent pursuing the writ while evaluating any limitation issues.

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To Read the full text of the Order CLICK HERE

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