Statutory appeal remedy bars writ petitions where GST jurisdictional challenges involve factual determinations.

The petitioners, comprising various Municipal Corporations, Nagar Parishads, and a Notified Area Committee in Jharkhand, filed writ petitions under Article 226 of the Constitution to challenge GST demand orders passed by CGST adjudicating authorities

The petitioners contended that as local self-government bodies, they are immune from taxation under the CGST Act, 2017, citing Constitutional protections under Articles 243W and 243X

Conversely, the Revenue argued that the GST was levied on routine commercial transactions of goods and services rather than core municipal functions

The impugned orders explicitly informed the petitioners of their right to appeal under Section 107 of the CGST Act, yet the petitioners approached the High Court directly, asserting the orders were "wholly without jurisdiction"

1. Whether Municipal Corporations and local self-government authorities enjoy absolute immunity from taxation under the CGST Act, 2017?

2. Whether the writ petitions should be entertained under Article 226 of the Constitution despite the availability of an alternative statutory remedy under Section 107 of the CGST Act?

The Court primarily applied Section 107 of the CGST Act, 2017, which mandates a statutory appellate process for aggrieved parties

It relied on the jurisdictional exceptions established by the Supreme Court in Whirlpool Corporation v. Registrar of Trade Marks [(1998) 8 SCC 1] and Godrej Sara Lee Ltd. v. Excise and Taxation Officer-cum-Assessing Authority [2023 SCC OnLine SC 95], which permit bypassing alternative remedies only when the impugned order is "wholly without jurisdiction," violates principles of natural justice, or challenges the vires of a statute

It adopted the reasoning from Oberoi Constructions Limited v. Union of India [(2025) 137 GSTR 601], emphasizing that Article 226 jurisdiction should be exercised sparingly when a statutory remedy exists

The Court found that the petitioners failed to demonstrate that the adjudicating authorities acted "wholly without jurisdiction"

It observed that municipal bodies are not blanketly exempt from GST; immunity depends on whether the specific transactions involve "core" municipal activities or routine commercial sales, a distinction requiring detailed factual determination

The Court reasoned that since the jurisdictional challenge is inextricably linked to factual aspects of the transactions, it is more appropriately addressed by the appellate authority rather than through the High Court’s summary jurisdiction under Article 226

The Court further noted that the petitioners did not challenge the constitutionality of the CGST Act itself, but merely the interpretation of its application to them, which does not constitute an "exceptional case" for bypassing the statutory hierarchy

However, recognizing that the petitioners were bona fide pursuing writ litigation, the Court granted them liberty to file statutory appeals within four weeks

The Court directed the appellate authority to decide such appeals on their merits without regard to the period of limitation, provided the appeals are instituted within the prescribed four-week window and comply with statutory formalities

The petitions were disposed of with no order as to costs