1 2025:CGHC:23490 NAFR HIGH COURT OF CHHATTISGARH AT BILASPUR WPT No. 29 of 2025 1. M/s Adhiraj Cements (A Partnership Firm), Having Its Office At Office No. 320, Lal Ganga Shopping Mall, GE Road, Raipur (C.G.), District- Raipur, Chhattisgarh- 492012, Through Its Partner Namely Shubham Singhal, S/o Navin Kumar Agrawal, Aged Around 36 Years, R/o Signature Homes, D Block, Flat No. 601, Near Hotel Hyatt, Behind Magneto Mall, Jeevan Vihar, Labhandih, Raipur (C.G.) Pin- 492006 2. Shubham Singhal S/o Navin Kumar Singhal Aged About 36 Years R/o Signature Homes, D Block, Flat No. 601, Near Hotel Hyatt, Behind Magneto, Mall Jeevan Vihar, Labhandih, Raipur (C.G.) Pin- 492006 ... Petitioners versus 1. Principal Commissioner Cgst And Central Excise, Raipur, Goods And Service Tax Bhawan, Tikarapara, Dhamtari Road, Raipur (C.G.) Pin- 492001 2. The Joint Commissioner (Prosecution And Fake Invoice Cell), Office Of Cgst And Central Excise, Raipur, Dhamtari Road, Tikarapara, Raipur (C.G.) PRIYANKA VERMA Digitally signed by PRIYANKA VERMA Date: 2025.06.16 10:26:51 +0530 2 3. The Superintendent (Prosecution And Fake Invoice Cell) Office Of Cgst And Central Excise, Raipur, Dhamtari Road, Tikarapara, Raipur (C.G.) ... Respondents For Petitioners : Mr. Hari Agrawal, Advocate For Respondents : Mr. Manish Sharma, Advocate Hon'ble Shri Justice Deepak Kumar Tiwari Order On Board 12/06/2025 1. With the consent of learned counsel for the parties, the matter is heard finally. 2. This Writ Petition has been filed under Article 226 of the Constitution of India and prayed for the following reliefs:- “a) A writ and/or order in the nature of appropriate writ calling the entire records of the case pertaining to the case of the petitioner. b) A writ and/or an order in the nature of appropriate writ do issue quashing/setting aside the show cause notice dated 28.03.2024 (Annexure P-7). c) A writ and/or an order in the nature of appropriate writ do issue directing the respondent authorities to immediately release the cash of Rs.17,50,000/-, seized during the search proceeding. 3 d) A writ and/or an order in the nature of appropriate writ do issue directing the respondent authorities to allow cross- examination of the persons, relying on whose statement, show cause notice has been issued. e) Cost of the proceedings. f) Any other relief in the discretion of this Hon’ble Court.” 3. Brief facts of the case are that a search was conducted on 11.09.2020 and 12.09.2020 respectively at the business premises of petitioner No.1 by respondent No.3. Thereafter, another search was conducted on 14.09.2020 at the manufacturing unit of the petitioners. Statements of the employees (supervisor and dispatch supervisor) of petitioner No.1 were recorded on 15.09.2020 under Section 70 of the Central Goods and Services Tax Act, 2017 (for short, “CGST Act”) and the petitioners under duress paid the taxable liability to the tune of Rs.6,37,49,114/-. Later on, the respondent authorities issued an intimation in Form DRC-01A under Sections 74 & 122(1A) of the CGST Act to the petitioners ascertaining the tax liability along with interest and penalty for the period from April, 2018 to March, 2021. Thereafter, on 28.03.2024, the petitioners received a show cause notice from the respondents in Form DRC-01A. On 22.04.2024, the petitioners also filed their reply in Form DRC-01A and thereafter, on 23.08.2024, the petitioners requested the respondents for cross-examination of the witnesses i.e. Indra Kumar Sahu, Dibya Nag and Jayadev Agrawal, whose statements were relied upon in the show cause notice, but no opportunity for cross-examination was provided to 4 them. Hence, this Petition has been filed. 4. Learned counsel for the petitioners submits that Section 122(1A) of the CGST Act was inserted by the Finance Act, 2020 (12 of 2020), [w.e.f 1- 1-2021], wherein it has been stipulated that any person who retains the benefit of a transaction covered under clauses (i), (ii), (vii) or clause (ix) of sub-section (1) and at whose instance such transaction is conducted, shall be liable to a penalty of an amount equivalent to the tax evaded or input tax credit availed of or passed on. He would further submit that at the relevant period for which the show cause notice was issued, the aforesaid section was not applicable at all, therefore, the authority has no jurisdiction to issue the said show cause notice dated 28.03.2024 under Rule 100(2) and 142(1)(a) in Form GST DRC-01. He also submits that the impugned notice is vague as the aforesaid notice is hit by the Departmental Circular dated 06.07.2022. Learned counsel places reliance on the matter of Sarva Shramik Sangh vs. Indian Oil Corporation Limited and others1 and referred to para 19, which reads as under:- “19. The assumption that there is an absolute bar on inconsistent pleas being taken by a party, is also not sound. What is impermissible is taking of an inconsistent plea by way of amendment thereby denying the other side, the benefit of an admission contained in the earlier pleading. Mutually repugnant and contradictory pleas, destructive of each other may also not be permitted to be urged simultaneously by a plaintiff/petitioner. But when there is no 1 (2009) 11 SCC 609 5 inconsistency in the facts alleged, a party is not prohibited from taking alternative pleas available in law. Similarly, on the same facts, different or alternative reliefs can also be claimed.” He further submits that petitioners may be allow to take appropriate pleas for alternative relief(s) permissible under law. He further submits that the show cause notice is the foundation on which the Department has to build up its case and when the show cause notice itself is vague, the jurisdiction of the High Court is not ousted. For the above submission, he places reliance on the matter of Commissioner of Central Excise, Bangalore vs. Brindavan Beverages (P) Ltd. and others2, therefore, he prays to allow the Petition. 5. On the other hand, learned counsel for the respondents submits that the petitioners have taken a contrary stand as on one side they sought relief for cross-examination of the witnesses and the Department has no objection in providing an opportunity to them in accordance with law and on the other side, they sought to quash the show cause notice dated 28.03.2024. He would further submit that in a catena of decisions, the law laid down is well settled that against a mere issuance of a show cause notice, a Writ Petition may be held to be pre-mature because the petitioner has every right to raise all such grounds before the adjudicating authority. He submits that in the present case, if the grounds taken in the present petition are raised before the adjudicating authority, the said authority will take care of all such grounds and take a decision in the matter. Furthermore, the petitioners have also an 2 (2007) 5 SCC 388 6 efficacious alternate remedy of filing an appeal if any adverse order is passed. For the above submission, he places reliance on the matters of Trade Tax Officer, Saharanpur vs. Royal Trading Company3, Union of India and Another vs. Kunisetty Satyanarayana4 and Pankaj Ispat Limited and another vs. Union of India (judgment dated 22.10.2018 passed by this Court in WPT No.56/2018), wherein, at para 22, the following material was observed:- “22.It is well settled principle of law that a person, who submits to the jurisdiction of an inferior tribunal/authority and takes part in the proceeding without any kind of protest or demur on the ground that tribunal/authority has no jurisdiction, cannot after having participated in those proceedings, turn around and question the jurisdiction of that tribunal/authority in petition under Article 226 of the Constitution of India. {See Messrs. Pannalal Binjraj and others v. Union of India and others, AIR 1957 SC 397 (paragraph 45) and Maharashtra State Road Transport Corporation v. Balwant Regular Motor Service, Amravati and others, AIR 1969 SC 329 (paragraph 11).}” 6. Having heard the submissions of learned counsel for the parties and 3 (2005) 11 SCC 518 4 (2006) 12 SCC 28 7 considering the facts and circumstances of the case, this Court is of the view that under the CGST Act, a show cause notice has been issued by the competent authorities and the petitioner would always be at liberty to raise the ground as to whether the provision under Section 122(1A) of the CGST Act is attracted or not or in any manner has no foundation, before the adjudicating authority. In this regard, the Hon’ble Supreme Court from time to time reiterated the aforesaid principle(s) that the High Court should be reluctant to interfere against mere issuance of show cause notice. In the matter of Kunisetty Satyanarayana (supra), it was materially observed at paras 14 and 15, which read as under:- “14.The reason why ordinarily a writ petition should not be entertained against a mere show- cause notice or charge-sheet is that at that stage the writ petition may be held to be premature. A mere charge-sheet or show-cause notice does not give rise to any cause of action, because it does not amount to an adverse order which affects the rights of any party unless the same has been issued by a person having no jurisdiction to do so. It is quite possible that after considering the reply to the show-cause notice or after holding an enquiry the authority concerned may drop the proceedings and/or hold that the charges are not established. It is well settled that a writ petition lies when some right of any party is infringed. A mere show- cause notice or charge-sheet does not infringe the right of any one. It is only when a final order imposing some punishment or otherwise adversely affecting a party is passed, that the 8 said party can be said to have any grievance. 15.Writ jurisdiction is discretionary jurisdiction and hence such discretion under Article 226 should not ordinarily be exercised by quashing a show-cause notice or charge sheet.” 7. On perusal of the show cause notice and the relevant provisions of the CGST Act and taking into consideration all the aspects of the matter, this Court is reluctant to interfere in the matter at this juncture, as no case is made out in favour of the petitioners. However, the petitioners are at liberty to raise all such grounds before the competent adjudicating authority. If the petitioners wish to cross-examine any of the witnesses, he may file an appropriate application in accordance with law before the competent authority. 8. It is observed that prior to calling of the witnesses for their cross- examination, the petitioners ought to file their reply within a period of 15 days from the date of receipt of a copy of this order and thereafter, they may file an appropriate application within the next 7 days. If any such application is filed by the petitioners, the concerned authority shall decide the same in accordance with law. 9. With the aforesaid observation and directions, this Petition stands disposed of. Sd/- (Deepak Kumar Tiwari) Judge Priyanka