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Judgment
ASHWANI KUMAR MISHRA, A.C.J. (Oral)
This petition seeks to challenge the vires of Rule 31A(3) of the CGST Rules, 2017 (for short ‘the Rules) as well as the circulars issued pursuant thereto, by the Department. The show cause notice as well as the order-in-original passed relying upon such Rules, are also assailed in this petition.
Though, in the writ, we find that various grounds are taken to assail the vires of the statutory rule, but we need not go into such issues as the question raised in this regard has been adjudicated by the Supreme Court in Directorate General of Goods and Services Tax Intelligence (HQS) vs. Gameskraft Technologies Pvt. Ltd., (2026) 42 Centax 495 (S.C.), decided on 27.05.2026m, whereby the vires of the Rules have been upheld, and the matters pending at different stages have been directed to be disposed of in the following manner:-
“86.1.The writ petitions and transferred cases are accordingly, dismissed, subject to the observations and directions contained in this judgment.
(i)The time for submitting replies to the show cause notices shall be eight weeks from the date of receipt of a copy of this judgment and considering the long pendency of the matter, the competent authority shall consider the same and pass orders, in accordance with law and in light of the findings recorded in this judgment, within a period of twelve weeks thereafter.
(ii)As the case may be, the time for filing appeals against the assessment orders shall be twelve weeks from the date of receipt of a copy of this judgment, and the competent authority shall consider the same and pass orders, in accordance with law and in light of the findings recorded in this judgment, as expeditiously as possible.”
Learned senior counsel for the petitioner submits that the order-in-original is not in keeping with the principles laid down by the Supreme Court in Gameskraft Technologies (supra), and in the event the issue was examined in line with the observations made by the Supreme Court, then the demand would get reduced to virtually one/fifth of what is being claimed now, even if the other issues are kept aside. It is, therefore, submitted that the matter be remitted to the adjudicating authority to revisit the issue, in light of the judgment of the Supreme Court in Gameskraft Technologies (supra).
Mr. Kapoor, learned counsel appearing for the respondents/Revenue states that in terms of para 86.1 of the judgment passed by the Supreme Court in Gameskraft Technologies (supra), the remedy available to the petitioner would be to file an appeal.
Learned senior counsel for the petitioner submits that huge financial liability has been imposed upon the petitioner, pursuant to the order impugned, running into hundreds of crores, and therefore, even the pre-deposit of 10% would cause excessive liability upon the petitioner, for which no funds are available. It is, therefore, submitted that the petitioner be not relegated to file an appeal.
Be that as it may, we find substance in the objection taken by the respondents to the prayer made by the senior counsel for the petitioner, inasmuch as the course available to the petitioner now, would be to challenge the order-in-original by filing an appeal.
We would not be justified in issuing any direction either to the adjudicating authority to revisit the matter, nor to issue any further direction, except for permitting the petitioner to pursue its remedy of appeal in terms of para 86.1 of the judgment in Gameskraft Technologies (supra). In the event the appeal is filed by the petitioner within a period of four weeks from today, the same shall be entertained without raising any objection with regard to the limitation.
Petition stands dismissed accordingly.
Pending applications, if any, shall stand disposed of.