Jharkhand High Court Clarifies Writ Jurisdiction Cannot Bypass Statutory Appeal Under CGST Act Absent Patent Jurisdictional Error or Natural Justice Violation

The Jharkhand High Court, comprising Chief Justice M.S. Sonak and Justice Rajesh Shankar, has reaffirmed the principle that the existence of an efficacious statutory remedy—such as an appeal under the Central Goods and Services Tax (CGST) Act, 2017—precludes the entertainment of a writ petition under Article 226 of the Constitution, except in cases involving a patent lack of jurisdiction or a clear violation of natural justice.

The petitioner challenged an Order-In-Original dated 26 December 2025, issued under Section 74 of the CGST Act, on grounds that the order was without jurisdiction and violated principles of natural justice. The petitioner argued that the case fell within the exceptions recognized by the Supreme Court in Whirlpool Corporation v. Registrar of Trade Marks, which allow writ jurisdiction to be invoked despite the availability of an alternative remedy in cases of jurisdictional error or breach of natural justice.

The petitioner contended that the necessary jurisdictional ingredients for invoking Section 74—fraud, willful misstatement, or suppression to evade tax—were absent, and that the show-cause notice was improperly issued based on a contested audit report. It was further argued that the matter was improperly recalled from the call book to avoid limitation, and that the petitioner’s jurisdictional objections were not considered in the impugned order.

The Revenue opposed these submissions, maintaining that the statutory remedy of appeal was adequate and that there was no jurisdictional defect or breach of natural justice. The Revenue relied on the Bombay High Court’s decision in Oberoi Constructions Ltd v. Union of India, which has been followed by the Jharkhand High Court in similar matters, to support the principle that writ jurisdiction should not be invoked where statutory remedies exist.

Upon consideration, the Court found that the petitioner had indeed been provided an opportunity to respond to the show-cause notice and that the impugned order addressed the issues raised. The Court held that the alleged jurisdictional errors and claims of natural justice violations involved disputed factual issues, which are best adjudicated in the appellate forum provided by the statute. The Court emphasized that its jurisdiction under Article 226 is discretionary and not intended to serve as an alternative to statutory remedies, especially where the statutory appeal is efficacious and not unduly onerous.

The Court referred to several Supreme Court precedents, including Special Director v. Mohd. Ghulam Ghous, State of Maharashtra v. Greatship (India) Limited, and Thansingh Nathmal v. Superintendent of Taxes, reiterating that writ jurisdiction should not be exercised to circumvent statutory procedures unless the impugned action is wholly without jurisdiction or there is a patent breach of natural justice. The Court found that neither exception was attracted in the present case.

Accordingly, the writ petition was dismissed, with liberty granted to the petitioner to file a statutory appeal within four weeks. The Court directed that if such an appeal is filed after compliance with statutory prerequisites, the Appellate Authority must consider it on merits without raising the issue of limitation, given the bona fide pursuit of the writ petition. All contentions were left open for determination by the Appellate Authority, and the Court’s observations were confined to the issue of maintainability of the writ petition.

This decision reinforces the judicial discipline of requiring parties to exhaust statutory remedies before invoking writ jurisdiction, unless exceptional circumstances are clearly established.