Facts of the Case

Lear Automotive India Private Limited challenged an adjudication order passed against it by the Additional Commissioner, CGST, contending that the Adjudicating Authority had failed to take notice of and appreciate Departmental Circular No. 235/29/2024-GST dated 11 October 2024, which the petitioner said had a direct bearing on the issue decided in the impugned order. Rather than press a full merits challenge in writ jurisdiction, counsel for the petitioner sought permission to avail the statutory rectification remedy available under Section 161 of the CGST Act, 2017.

Issues Involved

  1. Whether a taxpayer who claims that a relevant departmental circular was overlooked by the adjudicating authority should be relegated to the statutory rectification remedy under Section 161 rather than have the High Court examine the point on merits in writ proceedings.

Petitioner's Arguments

  • The Adjudicating Authority had failed to take notice of and apply Circular No. 235/29/2024-GST, which had a direct bearing on the issue in dispute, and the petitioner should therefore be permitted to invoke Section 161 to have this addressed.

Respondent's Arguments

  • The department's counsel raised no objection to the petitioner availing the Section 161 remedy, if otherwise permissible in law.

Court Order / Findings

  • The Court did not examine the merits of whether the circular was indeed applicable or wrongly overlooked, confining itself to a procedural disposal.
  • It disposed of the writ petition by reserving liberty to the petitioner to file a rectification application under Section 161 of the CGST Act within two weeks, which the Adjudicating Authority shall then consider and dispose of on merits.
  • The Court expressly clarified that its order was not to be construed as a determination of the matter on merits, and that any subsequent appeal or remedy would be decided uninfluenced by the observations in this order.

Important Clarification

  • Where a taxpayer's grievance is essentially that a relevant, applicable circular was not considered by the adjudicating authority, the High Court may decline to rule on the point itself and instead route the taxpayer to the statutory rectification remedy under Section 161, leaving the substantive question open for the adjudicating authority.
  • Such a disposal record no merits finding at all — it is purely an enabling order preserving the taxpayer's rectification remedy within a fixed time limit.

Sections Involved

  • Section 161, CGST Act, 2017 – empowers rectification of errors apparent on the face of the record in any decision, order, notice or certificate, on application by the affected person or suo motu by the authority.

Decision – In Favour of

The order is a purely procedural disposal reserving liberty to the assessee to seek rectification; it does not determine the underlying dispute in favour of either the assessee or the department.

Case Details

Court: High Court of Uttarakhand at Nainital. Case No.: Writ Petition (M/B) No. 202 of 2025. Coram: Hon'ble The Chief Justice G. Narendar. Date of Judgment: 9 June 2025.

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