Existence of alternative statutory remedy under CGST Act bars writ jurisdiction absent manifest jurisdictional error.

The Petitioner, a trader in agro-chemical products, was issued a Show Cause Notice (SCN) on 17.06.2025 by the DGGI alleging mis-declaration and clandestine clearance.

The Petitioner replied on 16.07.2025, denying allegations and seeking cross-examination.

On 16.12.2025, the Adjudicating Authority passed an Order-in-Original confirming a tax demand of ₹5,51,34,232, along with interest and equivalent penalties under Section 74 and 122 of the CGST Act.

The Petitioner challenged this order via a Writ Petition under Article 226, alleging violation of natural justice (non-receipt of hearing notices) and jurisdictional errors regarding penalty imposition, rather than filing a statutory appeal under Section 107.

1. Whether the writ petition is maintainable despite the availability of an alternative statutory remedy under Section 107 of the CGST Act.

2. Whether the Adjudicating Authority violated Section 75(4) and principles of natural justice by allegedly failing to serve notices for personal hearings.

3. Whether the Adjudicating Authority exceeded its jurisdiction by imposing penalties under Section 122 while proceeding under Section 74.

The court applied the principle that while Article 226 jurisdiction is discretionary, it is typically restricted when an alternative statutory remedy exists, except in cases of fundamental rights breach, violation of natural justice, excess of jurisdiction, or challenge to statutory vires, as held in Assistant Commissioner of State Tax v. Commercial Steel Limited.

Regarding the CGST Act, the court relied on Section 74(9) (duty to consider representations), Section 75(4) (mandate for personal hearing), and Section 169 (service of notice).

The court further adopted the reasoning from Patanjali Ayurved Limited v. Union of India, which establishes that an officer adjudicating under Section 73/74 is competent to impose consequential penalties under Section 122 within the same proceeding.

The court reasoned that the Petitioner's grievances—non-consideration of reply, lack of hearing service, and coerced statements—primarily involved disputed questions of fact and evidentiary appreciation.

It found that the Adjudicating Authority’s summary rejection of the Petitioner's reply as "not in consonance" did not equate to a total lack of consideration, but rather a matter of adequacy of reasoning to be tested in appeal.

On the service of notice, the court held that since the Impugned Order recorded hearing dates (09.10.2025, 14.10.2025, 06.11.2025), a factual inquiry into service under Section 169 was required, which is the domain of the appellate authority, not a writ court.

Finally, it rejected the jurisdictional challenge to penalties, noting that the CGST scheme and Rule 142 envisage the culmination of all consequential liabilities, including Section 122 penalties, in a single adjudication under Section 74.

The court clarified that all issues regarding facts, law, and natural justice can be effectively urged before the appellate authority.

It granted the Petitioner liberty to file a statutory appeal, directing that the period spent pursuing this Writ Petition be excluded for limitation purposes.