Facts of the Case

The petitioner, M/s Gemini Distillers (T) Private Limited, filed a writ petition before the High Court of Tripura at Agartala challenging Demand Orders dated 27.06.2023 (Annexures 6 to 9), covering Financial Years 2017-18, 2018-19, 2019-20 and 2020-21, and cumulatively raising a demand of over Rs.11 crore in tax, along with penalty and interest, passed by Respondent No.3. The petitioner alleged the orders were perverse in law, passed without jurisdiction, imposed an illegal levy, and were made in serious breach of principles of natural justice, and sought their quashing along with a stay against coercive recovery. The Commissioner, CGST, Agartala and the Additional Commissioner of Taxes & Excise, Government of Tripura, appeared before the Court pursuant to an earlier order dated 16.10.2023.

Issues Involved

  1. Whether the consolidated multi-year GST demand orders dated 27.06.2023, aggregating over Rs.11 crore, were valid and within jurisdiction.
  2. What bearing CBEC Circular No.31/05/2018-GST dated 09.02.2018 had on the demand raised.
  3. Whether the petitioner should be relegated to the statutory appellate remedy under Section 107 of the TGST Act instead of having the writ petition adjudicated on merits.

Petitioner's Arguments

  • The demand orders were perverse in law, passed without jurisdiction, and amounted to imposition of an illegal levy warranting quashing by way of certiorari.
  • The orders were passed in serious breach of the principles of natural justice, justifying a stay of the demand and protection from coercive recovery pending disposal of the writ petition.
  • Costs ought to be imposed for the undue harassment caused to the petitioner by the impugned demand.
  • After hearing submissions on the applicable CBEC circular, the petitioner's senior counsel sought permission to withdraw the writ petition in order to avail the statutory appellate remedy under Section 107 of the TGST Act, 2017, reserving liberty to raise all grounds of law and fact permissible in law before that forum.

Respondent's Arguments

  • The Commissioner, CGST, Agartala made submissions relying on Circular No.31/05/2018-GST dated 09.02.2018 issued by the CBEC (Annexure-13), bearing on the issues raised in the demand.
  • The Additional Commissioner of Taxes & Excise, Government of Tripura, was not fully conversant with the corresponding State Government notifications on the issue and was not in a position to make submissions.
  • Counsel for the CBEC/Commissioner CGST and the Government Advocate for the State did not object to the petitioner's request to withdraw the writ petition.

Court Order/Findings

  • After hearing the parties, including the submissions of the Commissioner, CGST, Agartala on the applicable CBEC circular, the Court permitted the petitioner to withdraw the writ petition with liberty to avail the statutory appellate remedy under Section 107 of the TGST Act, 2017, and to raise all grounds of law and fact permissible in law before that forum.
  • Pending applications, if any, were also disposed of.
  • No finding was recorded on the validity of the demand orders themselves, the Court leaving that determination entirely to the statutory appellate process.

Important Clarification

  • When faced with a large-value, multi-year consolidated GST demand challenged by writ, courts may decline to rule on jurisdictional or natural-justice grounds directly and instead permit withdrawal of the writ petition with liberty to pursue the statutory appeal under Section 107, especially once departmental circulars/notifications relevant to the dispute are placed before it.
  • Withdrawal with liberty of this kind preserves every ground raised in the writ petition (jurisdiction, natural justice, quantum) for full ventilation before the appellate authority — nothing is foreclosed by the withdrawal.
  • Taxpayers facing similarly large, multi-year demand orders should factor in the likelihood of being relegated to the statutory appeal route, and prepare their appellate grounds (including any jurisdictional or procedural objections) accordingly rather than relying solely on the writ remedy.

Sections Involved

  • Section 107, Tripura GST (TGST) Act, 2017 — statutory appellate remedy against demand orders, which the petitioner was permitted to pursue.
  • Article 226, Constitution of India — writ jurisdiction, from which the petitioner sought and was permitted to withdraw.
  • CBEC Circular No.31/05/2018-GST dated 09.02.2018 — clarificatory circular relied upon by the department in relation to the issues raised in the demand.

Decision – In Favour of

The disposal was not a substantive win for either side: the writ petition was withdrawn with liberty to pursue the statutory appeal under Section 107 of the TGST Act, so the outcome is best described as disposed of with directions, with the petitioner retaining full liberty to pursue all grounds before the appellate authority — neither the Assessee nor the Department secured a ruling on the merits of the Rs.11 crore demand.

Related Case Laws

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

Case Details

  • Court: High Court of Tripura, Agartala
  • Case No.: WP(C) No.604 of 2023
  • CNR: Not available on record
  • Coram: Hon'ble the Chief Justice Aparesh Kumar Singh and Hon'ble Mr. Justice Arindam Lodh
  • Decision Date: 19-10-2023
  • Disposal Nature: Withdrawn with liberty to pursue statutory appeal under Section 107 TGST Act

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