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2026 Supreme(Online)(Ker) 16826
IN THE HIGH COURT OF KERALA AT ERNAKULAM
VIJU ABRAHAM, J
VINOD P A – Appellant
Versus
ASSISTANT STATE TAX OFFICER – Respondent
WP(C) NO. 15883 OF 2022
For the Appellants/Petitioners: SRI.TOMSON T.EMMANUEL
For the Respondents: SMT.THANUJA ROSHAN, SHRI.P.PAULOCHAN ANTONY, SMT.SANJANA R.NAIR, GP – ADV.JASMIN
The court underscores the importance of an established appellate tribunal for resolving tax disputes and protecting the appellant's rights pending its formation.
Headnote:This writ petition challenges the imposition of penalty under the SGST Act following the dismissal of an appeal due to the absence of constituted appellate authority. The petitioner seeks to quash the penalty notice and prevent encashment of a bank guarantee pending the disposition of the petition. The court orders that the bank guarantee shall not be invoked until the appellate tribunal is formed, emphasizing the petitioner's obligation to renew the guarantee during this period. The ruling articulates the need for procedural compliance in tax disputes, particularly regarding the establishment of appellate review mechanisms.
| Table of Content |
|---|
| 1. challenge to penalty imposition and appeal dismissal. (Para 1 , 2) |
| 2. interim order preventing bank guarantee encashment. (Para 3) |
| 3. ruling aligning with previous court judgments. (Para 4) |
JUDGMENT
The above writ petition is filed seeking the following reliefs:
1. To call record from 1st respondent relating to detention, issuance of Ext.P3 notice, imposition of Ext.P6 penalty and to issue a writ of certiorari or any other appropriate writ or direction, in quashing Ext.P3 notice and Ext.P6 order passed by 1st respondent;
2. To issue a Writ of Certiorari or such other Writ, order or directing respondents 1 and 2, not to encash Ext.P5 Bank Guarantee, till the disposal of this Writ Petition, in the interest of justice;
3. To issue a Writ of Certiorari or such other Writ, order or directing 6th respondent Bank to keep Ext.P5 Bank Guarantee alive and not to permit encashment, till the disposal of this Writ Petition;
4. To pass such other orders as this Hon'ble Court may deem justified, to the facts and circumstances of the case;
2. The main contention raised by the petitioner is that though an appeal was preferred against the imposition of penalty as per Ext.P6 and the same was dismissed as per Ext.P8 order, the petitioner could not file a further appeal, since the 2nd appellate authority is not yet constituted by the GST Department. While so, Ext.P9 communication was issued demanding encashment of Ext.P5 bank guarantee. It is in the said circumstances that the petitioner has approached this Court.
3. When the matter came up for consideration on 13.05.2022, this Court has granted an interim order staying all further proceedings pursuant to Ext.P6 penalty imposed by the 1st respondent, which was justified in Ext.P8 – the first appellate order by the 5th respondent and further, a direction was issued to the 6th respondent not to permit encashment of Ext.P5 bank guarantee, provisionally, pending disposal of the writ petition.
4. The learned Government Pleader brought to my notice that in similar circumstances this Court has interfered and disposed of the matter and that this writ petition could also be disposed of in line with the said judgment, since the State Tax Appellate Tribunal has not been constituted and therefore, the encashment of bank guarantee provided by the petitioner can be kept in abeyance, provided the petitioner keeps alive the said bank guarantee for the time required.
Having regard to the facts and circumstances of the case and taking note of the fact that the State Tax Appellate Tribunal has not been constituted and started functioning in terms of Section 112 of the CGST/SGST Act, this writ petition is disposed of directing that the bank guarantee furnished by the petitioner as per Ext.P5 shall not be invoked for a period of three months from the date on which the State Tax Appellate Tribunal is constituted and start functioning, provided the petitioner keeps alive the bank guarantee for the above said period. It is also made clear that on constitution of the State Tax Appellate Tribunal, it is for the petitioner to seek appropriate relief from that Tribunal and the petitioner will not be entitled to the benefit of this judgment after three months from the date on which the said Tribunal is constituted.
Sd/-
