bombay high court

Bomby High Court: In a petition filed under Article 226 of the Constitution of India seeking interim relief while challenging the vires several provisions of the Central Goods and Services Tax Act, 2017 (‘CGST Act’), CGST Rules 2017, notifications and other provisions particularly surrounding levy of tax on betting and gambling, the Bench of G. S. Kulkarni and Jitendra Jain, JJ. issued notice to the Attorney General.

The petitioner sought issuance of:

  • Writ of certiorari for quashing the show cause notice dated 27-09-2023 issued by the respondent;

  • Writ of certiorari for striking down Section 15(5) of the CGST Act as unconstitutional and violative of Articles 246-A and 366(12) of the Constitution of India and Section 15(1) of the CGST Act, 2017;

  • Writ of certiorari for striking down Rule 31A(3) of the CGST Rules, 2017 as ultra vires Sections 2(31), 7, 9 and 15 of the CGST Act, 2017;

  • Writ of certiorari for striking down provisions of the CGST Act, the CGST Rules and Notifications thereunder along with corresponding provisions of the MGST Act, the MGST Rules and Notifications thereunder, to the extent they purport to levy ‘tax on betting and gambling’ in exercise of legislative power under Article 246A of the COI, due to lack of legislative competence;

  • Writ of prohibition for restricting the respondent or its officers/subordinates from taking any coercive action against the Petitioners;

  • Writ of prohibition restricting the respondents from adjudicating the Impugned SCN pending final disposal of this writ petition;

  • Ad interim order, costs, and suitable orders

The counsel for petitioners cited orders passed by the Division Bench of Bombay High Court in Delta Corp Limited v. Union of India (Writ Petition No. 717 of 2023) wherein, similar provisions were challenged, although, the activities of the assessees were different as pointed out by the Court. The Court had also directed maintenance of status quo on the show cause notices. Another case s cited by the petitioners was order dated 3-11-2023 in NGXN Sports Interactive Private Limited v. Union of India (Special Civil Application No. 19183 of 2023) wherein, ad-interim relief was granted restraining revenue from taking any further steps on the adjudication of the show cause notice while permitting the petitioners to file a response to the show cause notice.

Acknowledging the said stance, the Court resolved to pass similar orders as in Delta Corp (supra) and issued notice to the Attorney General regarding challenge to the provisions of Section 15(5) of the CGST Act, 2017 being unconstitutional and violative of Articles 246-A and 366(12) of the Constitution of India. The Court also directed the petitioners to file their reply to the impugned show cause notices without prejudice to its rights and contentions urged in the petition, and also kept it open for them to apply before the Chief Justice of the High Court to club all the matters to be heard by the appropriate Division Bench. The matter will probably next be heard on 17-01-2024.

[Playerzpot Media Pvt Ltd v. Union of India, 2023 SCC OnLine Bom 2627, Order dated 6-12-2023]

Advocates who appeared in this case :

For Petitioners: Advocate Bharat Raichandani, Advocate Onkar Sharma, Advocate Sudipta B., Advocate Prathamesh Gargate; Khaitan & Co.

For Respondents: Additional Government Pleader Jyoti Chavan, Advocate Jitendra B. Mishra, Advocate Satyaprakash Sharma, Advocate Sangeeta Yadav

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