Supreme Court Upholds High Court Order Refusing Interference Under Article 226 Where Alternate Appellate Remedy Exists Under GST

By | September 8, 2026
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Supreme Court Upholds High Court Order Refusing Interference Under Article 226 Where Alternate Appellate Remedy Exists Under GST

Supreme Court Upholds High Court Order Refusing Interference Under Article 226 Where Alternate Appellate Remedy Exists Under GST
Issue
Whether the High Court was justified in refusing to interfere under Article 226 against a GST penalty order when an effective alternative statutory appellate remedy under Section 107 of the CGST Act was available to the assessee.
Facts
  • Business & Allegations: The assessee, engaged in scrap trading, was investigated by CGST intelligence for allegedly availing fraudulent Input Tax Credit (ITC) through M/s Sri Ganpathi Enterprises.
  • Physical Verification: A physical verification conducted with a panchnama revealed that the declared principal place of business was merely an open space lacking operational infrastructure.
  • Issuance of SCN: A Show Cause Notice (SCN) in Form DRC-01 was issued proposing penalties under Section 122 for FY 2018-19 and FY 2019-20. The assessee submitted replies and participated in personal hearings.
  • Adjudication Order: An Order-in-Original (OIO) was passed followed by a demand order in Form DRC-07.
  • Writ Petition: The assessee filed a writ petition alleging partial service of SCN pages, non-supply/misdescription of Relevant Underlying Documents (RUDs), and a typographical error regarding the assessment period.
  • High Court Decision: The High Court dismissed the writ petition on merits and observed that an effective alternative statutory appellate remedy under Section 107 was available, granting four weeks to file an appeal.
  • SLP Filed: The assessee filed a Special Leave Petition (SLP) before the Supreme Court challenging the High Court’s dismissal.
Decision
  • In Favor of Revenue: The Supreme Court declined to interfere with the High Court’s order and disposed of the Special Leave Petition.
  • Upholding of Alternate Remedy Principle: The High Court rightly observed that the assessee ought to exhaust the statutory appellate remedy under Section 107 of the CGST Act rather than seeking extraordinary writ jurisdiction under Article 226.
Key Takeaways
  • Exhaustion of Alternative Remedies: Higher courts will not routinely entertain writ petitions under Article 226 against GST adjudication orders when a statutory remedy of appeal under Section 107 is readily available.
  • Typographical Errors Do Not Vitiate SCN: Minor typographical errors in assessment years or minor procedural grievances do not automatically constitute a breach of natural justice if the assessee had adequate opportunity to respond during adjudication.
SUPREME COURT OF INDIA
Shivani Enterprise
v.
Union of India
J.B. PARDIWALA and K. Vinod Chandran, JJ.
Special Leave to Appeal (C) No. 27455 of 2026†
AUGUST  17, 2026
Mrs. Mauna Bhatt, Sr. Adv., Malak Manish Bhatt, AOR and Ms. Sukanya Joshi, Adv. for the Petitioner.
ORDER
1. Having heard the learned senior counsel appearing for the petitioner(s) and having gone through the materials on record, we are of the view that we should not interfere as the High Court has rightly observed that the petitioner has an alternative remedy of preferring a statutory appeal under Section 107 of the Central Goods and Service Tax Act, 2017 (for short “the CGST Act”).
2. We grant four weeks’ time to the petitioner to prefer the statutory appeal before the Appellate Authority. It shall be open for the petitioner to raise all submissions available to him in law, including deficiencies in the show cause notice.
3. With the aforesaid, the Special Leave Petition stands disposed of.
4. Pending application(s), if any, stands disposed of.