A writ petition against a GST demand is not maintainable when an alternative remedy of appeal is available under Section 107 of the GST Act.

ORDER :

1. Assailing order dated 25.02.2025 passed in GST DRC-07 vide Annexure-5 by the Deputy Commissioner of State Tax, Cuttack-I West Circle, Cuttack-Opposite Party No.2, whereby and whereunder a demand to the tune of Rs.13,63,646/- comprising tax (Rs.4,82,531/-), interest (Rs.3,98,584/-)and penalty (Rs.4,82,531/-) for the tax periods from April, 2019 to March, 2020 has been raised invoking power under Section 74 of the Odisha Goods and Services Tax Act, 2017/the Central Goods and Services Tax Act, 2017 (collectively be called “the GST Act”), the Petitioner has approached this Court way of filing this writ petition under Articles 226 & 227 of the Constitution of India with the following prayer(s):

“Under the aforesaid circumstances it is prayed therefore that this Hon‟ble Court may be graciously pleased to:-

a. Admit the Writ Petition;

b. Issue Rule nisi calling upon the impugned order dated 25.02.2025 issued by the Opp. Party No.2 vide Annexure-5 shall not be quashed being illegal, arbitrary, unsustainable in law, contrary to scheme & intent of the Act and Rules;

c. Issue Rule nisi calling upon the Opp. Parties as to why initiation of proceeding u/s. 74 shall not be quashed being contrary to the provisions of the Act and Rules, illegal, arbitrary and not in accordance with law;

d. Issue Rule nisi calling upon the Opp. Parties as to why the impugned order dated 25.02.2025 issued by the Opp. Party No.2 vide Annexure-5 disallowing the claim of ITC on account of non filing of GST 3B by the suppliers, shall not be quashed being illegal, arbitrary, unsustainable in law, contrary to scheme & intent of the Act and Rules;

e. Issue Rule nisi calling upon the Opp. Parties as to why disallowance of Input Tax Credit (ITC) under clause (c) of sub-section (2) of Section 16 of CGST/OGST Act, 2017 shall not be quashed being contrary to the provisions of the Act and Rules, illegal, arbitrary and not in accordance with law and unconstitutional.

f. If the Opp. Parties fails to show cause or show insufficient cause, make the rule absolute;

g. To pass such further order/orders, direction/directions, writ/writs as may be deemed fit and proper in the circumstances of the case, in favour of the petitioner.

And for the act of kindness the petitioner shall as in duty bound and ever pray.”

2. The facts as adumbrated by the petitioner in the writ petition reveals that upon scrutiny of self-assessment returns furnished under Section 39 of the GST Act, the petitioner was requested by a notice in GST ASMT-10, dated 08.09.2022 to reverse Input Tax Credit (“ITC”, for short) of Rs.4,82,531/- availed for the periods August, September, October and November of 2019 under Integrated Goods and Service Tax Act, 2017 (for short, “IGST Act”) with respect to transactions effect with M/s. KVR Industries Limited, Sarasanapalli assigned with GSTIN37AACCK7954J1Z1. Consequent thereto finding there was a discrepancy in Form GSTR-3B vis-‡-vis claim of ITC, a proceeding under Section 73 of the GST Act was undertaken, but said proceeding was dropped on the ground that a proceeding under Section 74 of the GST Act had already been initiated.

3. Proceeding under Section 74 of the said Act, on participation by the petitioner and production of books of accounts and documents, culminated in demand, which is reflected in the order in DRC-07, dated 25.02.2025. The present writ petition is directed against said order framed under Section 74 of the GST Act.

4. Mr. Madhab Lal Agarwal, learned counsel appearing for the petitioner submitted that entire demand under Se