Facts of the Case

  • Filing of Writ Petition: The petitioner, M/s Om Prakash Ashok Kumar Jain, filed a writ petition (WRIT-C No. 21273 of 2022) before the Hon’ble High Court of Judicature at Allahabad.
  • Nature of Business & Claim: The petitioner firm engaged in the purchase and trade of packed food items directly from manufacturers, asserting that GST had already been duly paid on these items.
  • Relief Sought: The petitioner prayed for a writ of mandamus directing Respondent No. 2 not to levy Mandi Shulk (Mandi Fee) on packed food items. Additionally, a direction was sought for Respondent No. 2 to consider and decide the petitioner's pending representation dated 04.04.2022.
  • Interim Direction by the Court: On 30.08.2022, the Court granted time to the petitioner to file a supplementary affidavit placing on record tangible evidence or material demonstrating that an actual demand for Mandi fee had indeed been made by the respondents.

Issues Involved

  1. Whether a writ of mandamus can be issued to restrain authorities from levying Mandi Shulk (Mandi Fee) under the Krishi Utpadan Mandi Adhiniyam on GST-paid packed food items when no formal demand notice or evidentiary proof of demand has been issued or placed on record.
  2. Whether the writ petition is maintainable at a premature stage where the cause of action relies purely on apprehension rather than an actual enforceable demand.

Petitioner’s Arguments

  • Exemption under Statutory Mandate: The petitioner contended that under the provisions of the U.P. Krishi Utpadan Mandi Adhiniyam, the respondents have no legal authority to demand or levy Mandi Fee on packed food items.
  • Prior Payment of GST: It was strongly argued that since the packed food items were purchased directly from manufacturers and GST was already paid on them, subjecting them to Mandi Shulk would be unjust and improper.
  • Failure to Decide Representation: The petitioner submitted that a formal representation dated 04.04.2022 had been submitted to Respondent No. 2, which remained pending without any decision.

Respondent’s Arguments

  • Lack of Cause of Action: The respondents (represented by C.S.C., Rajesh Kumar Yadav, and Suresh C. Dwivedi) maintained that the petition lacked a concrete cause of action, as no formal demand notice levying Mandi fee had been served on the petitioner.
  • Failure to Provide Proof: It was asserted that without specific documentary evidence showing an active demand for Mandi Shulk, the petitioner's apprehension remains uncorroborated and premature.

Court Order / Findings

  • Failure to Substantiate Allegations: Upon perusing the supplementary affidavit filed by the petitioner, the High Court noted that no documentary evidence was brought on record to establish that any demand for payment of Mandi fee on packed items had actually been levied.
  • Dismissal of Premature Relief: Hon'ble Manoj Kumar Gupta, J. and Hon'ble Jayant Banerji, J. held that in the absence of any concrete demand on record, the Court was not inclined to issue any directional writ at this stage.
  • Liberty Granted: The Court disposed of the writ petition while explicitly leaving it open to the petitioner to raise and challenge the issue as and when any formal demand is actually raised against it in the future.

Important Clarification

  • Prematurity of Mandamus: A Writ of Mandamus cannot be granted purely on the basis of apprehension or unverified assumption. To maintain a writ petition against statutory authorities for illegal tax/fee collection, the petitioner must establish a clear legal injury or demonstrate an existing, enforceable demand order passed by the authority.

Sections Involved

  • U.P. Krishi Utpadan Mandi Adhiniyam (Relevant Levy Provisions)
  • Article 226 of the Constitution of India (Writ Jurisdiction for Mandamus)
  • Central Goods and Services Tax Act / U.P. Goods and Services Tax Act (Goods subjected to GST)

Link to download the order - https://mytaxexpert.co.in/uploads/1784627054_1867compressed.pdf

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