UP GST | No Interference Under Article 226 Unless Inherent Lack Of Jurisdiction Or Absence Of Relevant Material Established: Allahabad High Court

The Allahabad High Court has held that the writ court should not interfere in notice issued under Section 73 of the UP Goods and Service Tax Act, 2017 unless there is inherent lack of jurisdiction or complete absence of relevant material is alleged and established.

Petitioner challenged the adjudication notice issued under Section 73 (Determination of tax not paid or short paid or erroneously refunded or input tax credit wrongly availed or utilised for any reason other than fraud or any wilful-misstatement or suppression of facts) of the Uttar Pradesh Goods and Services Tax Act, 2017 on grounds that the reply filed by the petitioner. The notice under Section 73 was preceded by a notice under Section 61 (1) of the UPGST Act which provides that

“The proper officer may scrutinize the return and related particulars furnished by the registered person to verify the correctness of the return and inform him of the discrepancies noticed, if any, in such manner as may be prescribed and seek his explanation thereto.”

Counsel for respondent submitted that in the reply filed through offline mode, petitioner admitted that against transaction value of Rs. 11,50,000/- referred to in the notice, transaction value of Rs. 5,91,000/- was disclosed. Further disclosure of transaction worth Rs. 5,00,000/- was made upon receipt of notice.

The Court observed that it would be premature to conclude that there was no dispute requiring adjudication.

The bench comprising of Justice Saumitra Dayal Singh and Justice Manjive Shukla held

“The satisfaction required to be recorded in terms of Section 61(3) of the Act is primarily subjective. Unless inherent lack of jurisdiction or complete absence of relevant material is alleged and established, no interference may be warranted in exercise of extraordinary jurisdiction of this court under Article 226 of the Constitution of India.”

The Court declined to interfere in writ jurisdiction as there was no jurisdictional or fundamental error in the proceedings at the stage of issue of notice. Accordingly, the writ petition was dismissed.

Case Title: M/S Mgs Palace v. State Of U.P. And 4 Others [WRIT TAX No. - 1390 of 2023]

Case Citation: 2024 LiveLaw (AB) 4

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