Facts of the Case

M/s Rajdhani Traders, Alwar, Rajasthan, filed a writ petition before the Division Bench of the Rajasthan High Court at Jaipur challenging an Order-in-Original dated 24.12.2025 passed by the Assistant Commissioner, CGST Division, Alwar, raising a GST demand of Rs.1,13,57,300/- for Financial Years 2018-19 and 2019-20 on account of alleged wrongful availment and utilisation of input tax credit. The petitioner also sought to challenge a circular dated 06.07.2022. The writ petition was filed on 13.01.2026, within the time available under Section 107 of the CGST Act, 2017, factoring in the condonable delay of up to 30 days beyond the statutory 90-day period.

Issues Involved

  1. Whether the writ petition against the Order-in-Original was maintainable without the petitioner first exhausting the statutory appellate remedy under Section 107 of the CGST Act, 2017.
  2. Whether the challenge to the circular dated 06.07.2022 could be adjudicated within the same writ petition, or required separate proceedings.

Petitioner's Arguments

  • The Order-in-Original dated 24.12.2025 raising a demand of Rs.1,13,57,300/- for wrongful availment of input tax credit was challenged on merits, along with the underlying circular dated 06.07.2022.
  • The writ petition had been filed within the time prescribed under Section 107 of the CGST Act, 2017, including the condonable period.

Respondent's Arguments

  • The writ petition was not maintainable because the petitioner had an efficacious alternative remedy of appeal under Section 107 of the CGST Act, 2017, which had not been availed.
  • Learned counsel for the respondents urged that the challenge to the circular was, in substance, a device to bypass the appeal route and avoid the mandatory pre-deposit of 10% of the disputed demand.

Court Order/Findings

  • The Division Bench held it was not inclined to entertain the writ petition without the petitioner first exhausting the statutory remedy under Section 107, and accordingly dismissed the writ with liberty to raise all grounds, legal and factual, before the Appellate Authority.
  • Since the writ was filed within the appeal limitation period (including the condonable 120-day extension), the Court directed that the time spent before the High Court be excluded while computing limitation, provided the appeal is filed within 30 days.
  • The Court observed that the challenge to the circular dated 06.07.2022 appeared to be a device to avoid the appeal and the pre-deposit requirement, and left that challenge open to be agitated in appropriate proceedings.
  • To avoid prejudice, the Court granted liberty to the petitioner to file a fresh writ petition limited to the circular challenge if he felt the point had not been dealt with on merits, while directing that the challenge to the Order-in-Original be pursued only through the Section 107 appeal.

Important Clarification

  • A writ challenging a GST demand order for wrongful ITC availment will ordinarily be dismissed for non-exhaustion of the Section 107 appellate remedy, but courts commonly exclude the writ-pendency period from the limitation for filing that appeal.
  • Bundling a challenge to a departmental circular with a challenge to the assessment order, apparently to sidestep the mandatory pre-deposit, invites judicial scepticism; a separate, properly confined writ petition is the safer route for a genuine circular challenge.

Sections Involved

  • Section 107, CGST Act 2017 — provides the statutory appeal to the Appellate Authority against orders of an adjudicating authority, subject to a mandatory pre-deposit.
  • Article 226, Constitution of India — invoked for the writ petition, declined in favour of the statutory remedy.

Decision – In Favour of

Disposed of with directions, not a merits victory for either side — the writ against the Order-in-Original was dismissed on maintainability, but the petitioner retains the Section 107 appeal (with the writ period excluded from limitation) and liberty to separately pursue the circular challenge.

Related Case Laws

No directly on-point case notes are currently published on this site.

Case Details

  • Court: High Court of Judicature for Rajasthan, Bench at Jaipur
  • Case No.: D.B. Civil Writ Petition No.4039/2026
  • CNR: Not available
  • Coram: Justice Arun Monga and Justice Maneesh Sharma
  • Decision Date: 17-07-2026
  • Disposal Nature: Disposed of; relegated to statutory appeal under Section 107 CGST Act

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