Order Date: 03 August 2022

Key take away:

• The Petitioner, M/s Shivanjali Fashions, has prayed to declare the 2nd proviso to Section 16(2) of the CGST Act, 2017 as ultra vires and dehors the provisions of the India Contract Act, 1872 Act and also in violative of Articles, 14, 19(1)(g) and 300A of the Constitution.
• The other prayers in the petition inter-alia is to issue appropriate writ/order/direction to quash and set aside the demand cum show cause notices dated 13.06.2022.
• The High Court held that there is no gain saying that by show cause notice, the authorities have initiated the adjudicatory proceedings to ascertain the tax liability of the petitioner.
• Further, it will be open for the petitioner to raise all contentions in respect of the show cause notice. 
• It was also clarified that the challenge to the vires of the aforesaid provisions shall not be a ground for the petitioner to be raised to oppose the show cause notice and the adjudication proceedings.