Aarti Drugs Limited Vs Union of India and Others (Bombay High Court)
The Bombay High Court addressed a petition filed by Aarti Drugs Limited challenging a Show Cause Notice (SCN) dated August 2, 2024, and the resulting Order-in-Original dated February 3, 2025. Both the SCN and the Order-in-Original were based on the provisions of Rule 96(10) of the Central Goods and Services Tax Rules, 2017 (CGST Rules).
The Petitioner sought writs of certiorari and mandamus to quash and set aside the Impugned Order dated February 3, 2025.
The Court referred to its earlier decision in Hikal Ltd. Versus Union of India and others, which held that all pending proceedings based upon Rule 96(10) lapse consequent upon the Rule’s repeal via a notification dated October 8, 2024, due to the absence of a savings clause. The only exception mentioned was transactions that were “past and closed.”
The Respondent’s counsel argued against entertaining the petition, stating that:
- The Petitioner had an alternate and efficacious remedy to challenge the Order-in-Original.
- The Petitioner had not challenged the constitutional validity of Rule 96(10), unlike the Petitioner in Hikal Ltd.
The High Court acknowledged its general reluctance to entertain petitions when an alternate remedy exists. However, it was satisfied that the issue raised was substantially covered by the Hikal Ltd. decision. The Court noted that in Hikal Ltd., relief was granted in “almost similar circumstances.” Therefore, relegating the Petitioner to an alternate remedy was deemed “futile.”
