Facts of the Case

The petitioner, M/s Canara Bank, challenged an order dated 28th February 2025 passed under Section 73 of the WBGST/CGST Act, 2017 for tax period 2020-21. A show-cause notice had been issued on 19th November 2024 pointing out discrepancies, to which the petitioner had duly responded and was also permitted to file additional submissions after a personal hearing, as reflected in a communication dated 7th February 2025. The petitioner challenged the order on merits, contending it violated Section 17(4) of the CGST/WBGST Act and CBIC Circular No.199/11/2023-GST, before the Calcutta High Court.

Issues Involved

  1. Whether a writ petition challenging a Section 73 order purely on merits — alleging misapplication of Section 17(4) and a CBIC circular — is maintainable where the petitioner had already been afforded a hearing and had not alleged lack of jurisdiction.
  2. Whether, having failed on maintainability, the petitioner could still be granted a window to file a belated statutory appeal.

Petitioner's Arguments

  • The impugned order, insofar as it dealt with Section 17(4) of the Act, was contrary to CBIC Circular No.199/11/2023-GST dated 17th July 2023 as well as the statutory provision itself, and should be set aside on this merits ground.

Respondent's Arguments

  • No specific counter beyond supporting the impugned order is separately recorded; the Court's own reasoning reflects that the officer who passed the order had jurisdiction and had granted a hearing.

Court Order / Findings

  • The Court noted it was not the petitioner's case that the proper officer lacked jurisdiction, nor that opportunity of hearing was denied — the petitioner sought to challenge the order purely on merits.
  • Reiterating that where a multi-tier statutory adjudicatory process exists, the ordinary remedy is to file an appeal, and a writ petition is permitted only in extraordinary circumstances, the Court held the petitioner had not made out such extraordinary circumstances (no natural-justice violation, no want of jurisdiction) and dismissed the writ petition on this ground.
  • However, on the petitioner's request for leave to appeal after the order was passed, and noting the appeal-limitation period had already expired, the Court directed that if an appeal is filed within four weeks, the appellate authority shall hear and dispose of it on merits subject to compliance with other formalities.

Important Clarification

  • A writ petition challenging a GST adjudication order purely on the correctness of its interpretation of a substantive provision (here, Section 17(4)) or a circular, without alleging want of jurisdiction or breach of natural justice, will ordinarily fail for availability of an equally efficacious statutory appeal remedy.
  • Even where the writ itself fails on this maintainability ground, courts may still, in the interest of justice, grant a short additional window to file a statutory appeal despite the limitation period having already expired, so the taxpayer is not left without any remedy.

Sections Involved

  • Section 73, CGST/WBGST Act, 2017 – demand for tax not paid/short paid without fraud, under which the order was passed.
  • Section 17(4), CGST Act, 2017 – special ITC-reversal provisions for banking companies/financial institutions, central to the merits dispute.
  • Section 107, CGST Act, 2017 – statutory appeal remedy, the availability of which barred the writ on merits.

Decision – In Favour of

The decision is disposed of, in substance in favour of the department on the writ challenge itself (dismissed for availability of alternate remedy), though the petitioner was granted a limited window to pursue a belated statutory appeal.

Case Details

Court: High Court at Calcutta — Case No.: WPA 12726 of 2025 — Coram: Hon'ble Mr. Justice Raja Basu Chowdhury — Date of Order: 24 September 2025.

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