Facts of the Case

The petitioner, Sri Satyanarayana Educational Society, which runs an engineering college at Ongole, challenged an Assessment Order dated 27.04.2023 (Form GST ASMT-15) passed under Section 63 of the Andhra Pradesh GST Act, 2017, demanding a total of about Rs. 2.89 crore (comprising tax of about Rs. 1.21 crore, interest of about Rs. 47.42 lakh, and an equal penalty of about Rs. 1.21 crore) for the tax periods 2020-21 to 2022-23. The dispute traced back to a lease arrangement with the Rajiv Gandhi University of Knowledge Technologies (RGUKT), Ongole Campus, where the Society sought to have the applicable GST on lease amounts paid directly by RGUKT or adjusted, rather than being demanded from the Society itself. A preceding show-cause notice (Form GST ASMT-14) had also been issued under Section 63. The Society challenged both the show-cause notice and the resulting assessment order as illegal, arbitrary and violative of natural justice and Articles 14, 19 and 21 of the Constitution.

Issues Involved

  1. Whether the Assessment Order dated 27.04.2023 passed under Section 63 of the APGST Act was liable to be set aside as illegal and violative of natural justice.
  2. Whether the writ petition should be entertained given the existence of an efficacious statutory appellate remedy under Section 107 of the APGST Act.

Petitioner's Arguments

  • The Assessment Order and the preceding Show Cause Notice were illegal, arbitrary and passed in violation of the principles of natural justice and the petitioner's fundamental rights under Articles 14, 19 and 21 of the Constitution.
  • The petitioner had separately requested the university (RGUKT) to arrange payment of the 18% GST amount on the lease consideration directly to the tax authorities, or to have it adjusted against dues, rather than being fastened with the liability itself.

Respondent's Arguments

The Government Pleader for Commercial Tax, representing Respondents 1 and 2, did not contest the availability of the statutory appellate remedy; the Court itself noted that an efficacious and alternative remedy of appeal was available against the impugned assessment order.

Court Order / Findings

  • The Court held that, since an efficacious alternative remedy in the form of a statutory appeal was available against the Assessment Order, it would not go into the merits of the petitioner's case.
  • The writ petition was disposed of with liberty to the petitioner to file a statutory appeal within two weeks, on making the pre-deposit required under Section 107 of the APGST Act, with a direction that the Appellate Authority admit and decide the appeal on merits in accordance with law.
  • Pending the filing of the appeal, the respondents were directed not to take coercive recovery steps against the petitioner.

Important Clarification

This is a relegation order, not a ruling on whether the underlying GST demand — arising from a lease-cum-GST-liability dispute with a government university — was correctly raised. Taxpayers facing large Section 63 best-judgment assessments should note that High Courts frequently decline to examine the merits where a statutory appeal mechanism (with pre-deposit) exists under Section 107, reserving substantive scrutiny for the Appellate Authority.

Sections Involved

  • Section 63, Andhra Pradesh Goods and Services Tax Act, 2017 — assessment of unregistered persons
  • Section 107, Andhra Pradesh Goods and Services Tax Act, 2017 — appeals to Appellate Authority
  • Article 226, Constitution of India, 1950

Decision – In Favour of

Disposed of without a decision on merits; the petitioner was relegated to the statutory appellate remedy, with interim protection against coercive recovery pending the appeal.

Case Details

  • Court: High Court of Andhra Pradesh at Amaravati
  • Case No.: Writ Petition No. 18279 of 2023
  • Coram: Hon'ble Sri Justice U. Durga Prasad Rao and Hon'ble Smt Justice Venkata Jyothirmai Pratapa
  • Date of Order: 28 July 2023

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