Uttarakhand High Court
8 August vs State Of Uttarakhand And Others on 18 August, 2025
2025:UHC:7269-DB
IN THE HIGH COURT OF UTTARAKHAND AT NAINITAL
THE HON'BLE CHIEF JUSTICE MR. G. NARENDAR
AND
THE HON'BLE JUSTICE MR. ALOK MAHRA
Writ Petition Misc. Bench No. 668 of 2025
18 August, 2025
M/s Radha Krishna ...........Petitioner
Versus
State Of Uttarakhand and Others .......Respondents
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Presence:-
Mr. Rishab Ranghar, learned counsel for the petitioner.
Ms. Puja Banga, learned Brief Holder for the State of Uttarakhand
through Video Conferencing.
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JUDGMENT :
(per Mr. G. Narendar C. J.)
Heard learned counsel for the petitioner
and learned State counsel.
2. The brief facts, necessary for disposal of
the present writ petition are that, the petitioner is
a registered proprietor under the Central Goods
and Services Tax Act, 2017 (“CGST Act“) carrying
on business under the trade name M/s Radhe
Krishna. The petitioner is aggrieved by the
recovery citation dated 05.08.2025 issued by the
Tehsildar under Section 79(1)(c) of the CGST Act
for recovery of an amount of ₹12,58,552/-.
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3. It is not in dispute that a notice in FORM
GST ASMT-10 under Section 61 of the Act was
issued on 18.07.2022, pointing out discrepancies
between the Input Tax Credit (ITC) claimed in
GSTR-3B and the ITC reflected in GSTR-2A for the
financial year 2017-18, calling upon the petitioner
to furnish explanation within 30 days.
Subsequently, on 30.11.2022, a show cause notice
in FORM GST DRC-01 was issued under Section
73(1) alleging wrongful availment of ITC and
proposing a demand of ₹11,44,137.48/-.
4. Thereafter, further notices dated
04.02.2023 and 15.02.2023 were issued, to which
no reply was filed within the stipulated time.
Consequently, the respondent department passed
a final order dated 31.05.2023 under Section
73(9) of the Act, raising a demand of
₹12,58,552/- (comprising tax of ₹11,44,138/- and
penalty of ₹1,14,414/-), and issued a demand
notice in FORM GST DRC-07 under Rule 142(5) of
the CGST Rules, 2017.
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4. Learned counsel for the petitioner would
submit that the petitioner was not aware of the
subsequent notices dated 04.02.2023 and
15.02.2023 and could not file a reply due to lack
of knowledge with the GST regime. It is urged that
the petitioner challenged the final order dated
31.05.2023 by filing a statutory appeal in FORM
GST APL-01 on 06.08.2025 under Section 107(1)
of the Act read with Rule 108(1) of the Rules,
within limitation. Along with the appeal, the
petitioner deposited 10% of the disputed tax
amounting to ₹1,14,414/-, in compliance with
5. It is contended that despite pendency of
the statutory appeal and compliance with the
mandatory pre-deposit requirement, the Tehsildar
proceeded to issue the impugned recovery citation
under Section 79(1)(c), which is ex facie arbitrary
and contrary to law.
6. Per contra, learned State counsel would
submit that the recovery citation was issued prior
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to filing of the appeal but admits that the
petitioner has deposited the mandatory pre-
deposit while filing the statutory appeal.
7. It is admitted that the petitioner has filed
a statutory appeal under Section 107 within the
period of limitation prescribed under Section
107(4) of the Act, and has deposited the pre-
deposit of 10% of the disputed tax as mandated
by Section 107(6).
8. In view of the settled legal position, once
a statutory appeal has been preferred in
compliance with Section 107(6), recovery of the
balance demand is deemed to be stayed till
disposal of the appeal. Consequently, initiation of
recovery proceedings under Section 79 of the Act,
during pendency of such appeal is unsustainable in
law. Accordingly, the recovery citation dated
05.08.2025 issued by the Tehsildar under Section
79(1)(c) of the CGST Act is hereby quashed and
set aside.
9. It is clarified that the rights and liabilities
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of the parties shall abide by the final outcome of
the statutory appeal. Liberty is reserved to the
parties to take recourse to remedies available
under law, depending upon the result of the
appeal.
10. The writ petition stands disposed of in
the above terms.
11. Pending applications, if any, stand
disposed of accordingly.
(G. NARENDAR, C. J.)
(ALOK MAHRA, J.)
Dated: 18.08.2025
Mamta
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