The Meghalaya High Court addressed a case involving M/s Jorabat Shillong Expressway Limited, which was challenged with a GST demand of ₹112.39 crore on annuity receipts from a highway project. The company argued that these receipts were exempt under Entry 23A and questioned the jurisdiction of the officers who issued the show cause notice, claiming they were not “proper officers” under the CGST Act.
The primary issue was whether the High Court should use its writ jurisdiction under Article 226 to resolve disputes about GST liability on BOT annuity receipts. The Court concluded that the officers were empowered by notifications under Sections 3 and 5 of the CGST Act, dismissing the jurisdictional challenge. The Court emphasized that disputes over service classification, exemption applicability, and taxability require examining contractual and factual details, which are not purely legal questions suitable for writ jurisdiction.
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The Court highlighted that the petitioner had engaged in adjudication proceedings and received a detailed Order-in-Original. It stated that the statutory appellate mechanism under the CGST Act is the proper venue for addressing the correctness of the adjudicating authority’s conclusions. The Court dismissed the claim that the appellate remedy was inadequate due to binding departmental circulars, finding no violation of natural justice or jurisdictional errors that would justify bypassing the statutory appeal process.
Order Date - 02 June 2026
Parties: M/s Jorabat Shillong Expressway Limited Vs Union of India & Others (including CBIC, GST Council, DGGI, CGST Authorities and State of Meghalaya)
Facts -
- M/s Jorabat Shillong Expressway Limited was incorporated to execute the Jorabat–Shillong highway project under a BOT (Annuity) concession agreement with NHAI, under which it was entitled to receive annuity payments after commencement of commercial operations.
- The GST department issued a show cause notice alleging non-payment of GST on annuity receipts and subsequently passed an Order-in-Original dated 18.04.2024 raising a GST demand of ₹112.39 crore (CGST + SGST) along with interest and penalty for the period July 2017 to December 2022.
- The petitioner contended that annuity receipts were exempt under Entry 23A relating to services by way of access to a road or bridge on payment of annuity and challenged the validity of the GST Circular dated 17.06.2021.
- The petitioner also challenged the jurisdiction of DGGI and CGST officers who issued the show cause notice and adjudication order, alleging that they were not “proper officers” under the CGST Act.
Issue -
- Whether the High Court should exercise writ jurisdiction under Article 226 to decide disputes relating to GST liability on BOT annuity receipts?
Order -
- The Court held that the officers issuing the show cause notice and adjudication order were duly empowered under Notifications issued under Sections 3 and 5 of the CGST Act. Therefore, the challenge to their jurisdiction did not establish any inherent lack of authority warranting interference under Article 226.
- The Court observed that disputes concerning classification of services under SAC 9954 or SAC 9967, applicability of Entry 23A exemption, characterization of annuity receipts, and taxability of composite supplies involve examination of contractual terms and factual issues. Such matters are not pure questions of law suitable for adjudication in writ jurisdiction at the first instance.
- The Court noted that the petitioner had already participated in adjudication proceedings, filed replies, and received a reasoned Order-in-Original. Whether the adjudicating authority’s conclusions were correct or incorrect is a matter that falls within the statutory appellate mechanism provided under the CGST Act.
- The Court rejected the argument that the appellate remedy was ineffective merely because departmental circulars are binding on tax authorities. It held that no violation of natural justice, patent lack of jurisdiction, or other recognized exceptions to the rule of alternate remedy had been established, making the statutory appeal the appropriate forum.
