Kerala HC Upholds Validity of GST Saving Clause; Dismisses Appeal

Case Details

• Case Name: M/s. Akash Roofing v. Union of India & Ors.

• Court: High Court of Kerala at Ernakulam

• Case No.: WA No. 50 of 2025 (arising out of WP(C) No. 29325 of 2023)

• Judgment Date: 13 January 2025

• Category: Constitutional Validity – Transitional Provisions under GST

• Relevant Section: Section 174(2) of the Central Goods and Services Tax Act, 2017

• Connected Statutory Provisions: Section 174 CGST Act (Repeal and Savings), Article 265 of Constitution of India

Facts of the Case (Para 2, 5, 6)

• The appellant, M/s. Akash Roofing, a proprietary concern manufacturing roofing sheets, paid excise duty of ₹96,81,106/- for 2015–17.

• On 28.08.2019, a show cause notice (Ext.P1) was issued by DGGI (3rd respondent).

• Earlier, the appellant challenged Ext.P1 before Kerala HC in WP(C) No. 34242/2019, which was dismissed on 13.12.2019, directing filing of objections. Appeal WA No. 578/2020 against that dismissal is still pending.

• Despite no interim relief, the department passed a final order (Ext.P3 dated 31.03.2021) and demand notice (Ext.P4 dated 04.05.2021).

• The appellant challenged Section 174(2) CGST Act as unconstitutional and assailed Ext.P1 & Ext.P3 before the Single Judge.

Question(s) in Consideration (Para 3, 5)

1. Whether Section 174(2) of the CGST Act, 2017 (saving clause) is unconstitutional?

2. Whether the writ petition challenging Ext.P3 final order was maintainable despite the availability of alternate statutory remedy of appeal?

Observations of the Court (Para 5, 6)

• The constitutional validity of Section 174(2) was already upheld by a Co-ordinate Bench in WA No. 747/2019 (30.11.2022).

• The appellant had an effective statutory remedy to challenge Ext.P3 order but failed to avail it.

• The appellant chose to file writ petitions instead of contesting the matter on merits before the adjudicating authority.

• The Court found no justification to reopen constitutional issues already settled and held that writ jurisdiction cannot be invoked merely because the petitioner failed to respond on merits.

Judgment of the Court (Para 6)

• The Division Bench upheld the Single Judge’s decision dismissing the writ petition.

• The Court held that alternate remedy under the Act must be availed and writ appeal was not maintainable.

• Consequently, WA No. 50 of 2025 was dismissed without costs.

Between Fine Lines

1. Section 174(2) of CGST Act is constitutionally valid; challenges are now settled law.

2. Taxpayers must file objections and use the appellate remedy; writs cannot bypass procedure.

3. Earlier dismissal of writs on the same notice prevents fresh constitutional arguments.

4. Courts frown upon repeated litigation when alternate remedies exist.

5. Appeals against adjudication orders must be pursued under GST law, not via writ petitions.

Summary of Referred Cases

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