IN THE HIGH COURT OF MADHYA PRADESH
AT INDORE
BEFORE

HON'BLE SHRI JUSTICE VIVEK RUSIA
&
HON'BLE SHRI JUSTICE BINOD KUMAR DWIVEDI ON

THE 29^th OF OCTOBER, 2025

WRITPETITIONNo.40749of2025

GR INFRA PROJECTS LIMITED RATLAM THROUGH ITS
AUTHORIZED SIGNATORY MR. BHOORI SINGH
Versus
THE STATE OF MADHYA PRADESH AND OTHERS

Appearance:

Shri Jatin Har jaia long with Ms. Priyal Jain-Advocate for the petitioner.

Shri Bhuwan Gautam - Government Advocate for the respondent/State.

ORDER

Per: Justice Vivek Rusia

1. Petitioner has filed this present petition under Article 226 of the Constitution of India seeking the following reliefs:-

"(i) Issue a Writ of Certiorari and quash and set aside the impugned Show Cause Notice dated 13.06.2025 (Annexure P/7).

(ii) Alternatively, issue a Writ of Mandamus to Respondent No.3 directing it to adjudicate upon the Preliminary Objections filed by the Petitioner and consequently pass a reasoned, speaking order.

(iii) Pass any other further orders that this Hon’ble High Court deem fit in the interest of justice."

2. Petitioner is a Company in corporated under the provisions of the Companies Act,1956.The petitioner-company is engaged in the design and on structi on of various roads and highway projects. The petitioner is also registered under the Central Goods and Services Tax Act, 2017 and M.P. GoodsandServicesTaxAct,2017. Assistant Commissioner, State Tax, Anti Evasion Bureau, Indore B, Madhya Pradesh issued as ummon under Section 70 to Mr. Kuldeep Jain,who is the authorised signatory of the petitioner, calling upon him to appear a long with certain documents .He appeared a long with the documents. In the month of August, 2022 the premises of the petitioner was searched by the GST officials. According to the petitioner, the full cooperation was extended by producing all the documents as demanded time to time.

3. On 29.4.2025 an intimation under Rule 142(1A) in the Form DRC01A along with annexure was issued to the petitioner by the respondent No.3. The petitioner submitted detailed response on 14.5.2025 along with the preliminary objections to the validity of the proceedings. The petitioner was not supplied the draft notice dated 3.3.2025, on which this DRC-01A was based. In response to the objection, respondent No.3 provided the said draft notice dated3.3.2025on27.5.2025.After going through the said draft notice, the petitioner again submitted a detailed objection. Now the respondent No.3 has issued a show-cause notice dated 13.6.2025 under Section 74 of the CGST Act read with MPGST Act in respect of demand of tax of Rs.1,52,56,431/-. The details are as under:-

4. The petitioner filed a preliminary objection to question the validity of the impugned SCN and now filed the present petition before this Court seeking quashment of SCN.

5. Learned counsel appearing for the petitioner submits that the tax period pertaining to which this notice under Rule 142(1A) and the present SCN have been issued, is 2018-19. Both the notices are based on the allegation of evasion of tax by way of fraud or willful misstatement. The allegations of fraud and willful evasion as they are very vague and no such details have been given in it. Therefore, such notice is unsustainable in law. The authorities could have issued the notice under Section 73 in absence of any  material of fraud and willful evasion, for which the limitation is only 3 years. Therefore, instead of participating in the show-cause notice, the petitioner has approached this Court by way of writ petition. In support of his contention, learned counsel has placed reliance on the judgment passed by the Apex Court in the case of Uniworth Textiles Ltd. Vs. Commissioner of Central Excise, Raipur reported in 2013(9) SCC 753, in which the Apex Court has held that the burden of proof of proving mala fide conduct under proviso to Section 28 of the Customs Act,1962 lies with the Revenue;that in furtherance of same, no specific averments find a mention in show cause notice which is a mandatory requirement for commencement of action under said proviso. Unless the assessee is put to notice, the assessee would have no opportunity to meet the case of the Department on the issue of fraud, collusion or willful misstatement or suppression of fact. Learned counsel has also placed reliance on a recent Division Bench decision of High Court of Allahabad in the case of Hcl Infotech Ltd. Vs. Commissioner, Commercial Tax and others vide order dated 27.9.2024 passed in Writ Tax No.1396 of 2024, in which the similar show cause notice issued to the petitioner (therein) has been quash edinter-alia on the groundth at the show-cause notice does not make a whisper of the fact that petitioner had wrongly availed or utilized Input Tax Credit due to any fraud, or wilful misstatement or suppression of facts to evade tax. Learned counsel has also placed reliance on a Division Bench judgment of Allahabad High Court in the case of SCN issued to sister concern of the petitioner M/s Varanasi Sangam Expressway Pvt. Ltd. Vs. Commissioner of State Tax vide order dated 8.10.2025 passed in Writ Tax No.1028 of 2025.

6. Shri Bhuwan Gautam, learned Government Advocate appearing for the respondents submits that the writ petition is not maintainable. The petitioner has already filed reply to the show cause notice. The petitioner is free to raise all these grounds before the proper officer. After passing the order in original, the petitioner shall have a remedy under Section 107 of the MPGST Act to file an appeal and thereafter further appeal to the GST Appellate Tribunal.

We have heard the learned counsel for the parties and per used the record.

7. So far as the judgments passed by the Allahabad High Court in the matter of Hcl Infotech Ltd. & M/s Varanasi Sangam Expressway Pvt. Ltd. (supra) is concerned, there is a specific observation by the Court that in the SCN there is now his per about the allegations of fraud, or wilful misstatement or suppression of facts. The copy of show cause notice issued and the relied on cases has not been filed by the petitioner in this petition to compare with the show cause notice issued to the petitioner. In the show-cause notice issued in the present case, there are specific allegations of fraud and willful suppression of facts against the petitioner.

8. It is clear from the contents of draft notice dated 3.3.2025 prepared by the Office of Dy. Commissioner, Commercial Tax, Audit Wing-2, Indore that the commercial place of the petitioner was searched under Section 67 of the GST Act. This report runs into 191 pages containing material of wilful evasion of GST of Rs.1,52,56,431/- in the year 2018-19.As per the language of Section 67 of the GST Act, where the proper officer, not below the rank of Joint Commissioner, has a reasons to believe that a taxable person has suppressed any transaction relating to supply of goods or services or both or the stock of goods in hand and indulged in contravention of any of the provisions of this Act to evade tax under this Act may, in writing, inspect any place of business of the taxable person or the person engaged in the business. Where the proper officer has reasons to believe that any person said to have evaded or is attempting to evade the payment of any tax, he may, for reasons to be recorded in writing, seize the accounts, registers or documents of such person. The power of arrest has been given under Section 69. After completing such inspection, search and seizure, the proper officer either may issue notice under Section73 or under Section 74 to the assessee.The difference between both the sections is regarding period of limitation, which is 3 years and 5 years respectively. Therefore, at this stage, once the show cause notice has been issued under Section 74, it cannot be examined by the writ court that the proper officer has erroneously issued the notice under Section 74 without there being any reason of fraud or willful misstatement of fact to evade the tax. Even after conducting an enquiry under Section 74, if the proper officer is failed to establish the allegations of fraud, willful misstatement or suppression of fact, the order-in-original may be passed under Section 73. Subsection (3) of Section 74 says that "where a notice has been issued for any period under sub-section (1), the proper officer may serve a statement, containing the details of tax not paid or short paid or erroneously refunded or input tax credit wrongly availed or utilised." Sub- section (4) says that "the service of statement under sub-section (3) shall be deemed to be service of notice under sub-section (1) of section 73, subject to the condition that the grounds relied upon in the said statement, except the ground of fraud, or any wilful-misstatement or suppression of facts to evade tax."

9. Therefore, at present no prejudice is being caused to the petitioner to participate in the show cause notice proceedings. Learned counsel for the petitioner submits that even if the petitioner participates and proper officer may pass order under Section 73, but the period of limitation under Section73 is 3 years, whereas the limitation under Section 74 is 5 years, therefore, this SCN proceeding would be time barred. This is sue will also be decided by the authority after considering the material against the petitioner.

10. The Apex Court in the case of State of Maharashtra & Others v/s Greatship (India) Limited reported in (2022) 17 SCC 332 has held that the High Court has seriously erred in entertaining the writ petition under Article 226 of the Constitution of India against the assessment order and ought to have relegated the writ petitioner to avail the statutory remedy of appeal. Paragraphs 14 to 17 of the aforesaid judgment are reproduced below:

"14.Applying the law laid down by this Court in the aforesaid decision, the High Court has seriously erred in entertaining the writ petition under Article 226 of the Constitution of India against the assessment order, by-passing the statutory remedies.

15. Now so far as the reliance placed upon the decisions of this Court by the learned Senior Advocate appearing on behalf of the respondent, referred to here in above, are concerned, the question is not about the maintainability of the writ petition under Article 226 of the Constitution, but the question is about the entertain ability of the writ petition against the order of assessment bypassing the statutory remedy of appeal. There are serious disputes on facts as to whether the assessment order was passed on 20.03.2020 or 14.07.2020 (as alleged by the assessee). No valid reasons have been shown by the assessee to by-pass the statutory remedy of appeal. This Court has consistently taken the view that when there is an alternate remedy available, judicial prudence demands that the court refrains from exercising its jurisdiction under constitutional provisions.

16. In view of the above and in the facts and circumstances of the case, the High Court has seriously erred in entertaining the writ petition against the assessment order. The High Court ought to have relegated the writ petitioner–assessee to avail the statutory remedy of appeal and thereafter to avail other remedies provided under the statute.

17. Under the circumstances, the impugned judgment and order  passed by the High Court is here by quashed and set aside. The writ petition filed before the High Court challenging the assessment order and consequential notice of demand of taxis hereby dismissed. The respondent – assessee is relegated to avail the statutory remedy of appeal and ot her remedies available under the MVAT Act and CST Act. It is directed that if such a remedy is availed with in a period of four weeks from today, the appellate authority shall decide and dispose of the same on its own merits in accordance with law without raising any question of limitation, however, subject to fulfilling the other conditions, if any, under the statute. It is made clear that we have no tex pressed any opinion on the merits of the case in favour of either of the parties and it is for the appellate authority and/or appropriate authority to consider the appeal/proceedings on its/their own merits and without being influenced in any way by any of the observations made by the High Court which otherwise have been set aside by the present order. The present appeal is allowed in the aforesaid terms. However, in the facts and circumstances of the case, there shall be no order as to costs."

11. In view of the above, the petition is dismissed. The proper officer shall not be influenced by any observations made hereinabove.