The Allahabad High Court, Lucknow Bench, has stayed coercive recovery proceedings arising from a GST penalty after observing that the challenge raises a prima facie jurisdictional issue regarding the retrospective application of Section 122(1A) of the CGST Act.
The bench of Justice Saurabh Lavania observed that a writ petition is maintainable where the impugned order is alleged to have been passed without jurisdiction.
The bench directed that no coercive recovery be initiated against the petitioner until the next date of hearing, subject to the furnishing of an indemnity bond within ten days.
Buy Now: GST Judgements E-Compilation – June 2026
The petitioner/ASSESSEE challenged two GST orders: an order dated 19 November 2024 passed by the Additional Commissioner, Central GST, Lucknow, imposing penalty for Assessment Year 2020–21. An appellate order dated 18 December 2025 passed by the Commissioner (Appeals), Central GST, Lucknow, affirming the penalty.
The principal contention was that the penalty had been imposed under Section 122(1A) of the CGST Act, a provision introduced through the Finance Act, 2020 and made effective from 1 January 2021. According to the petitioner, the provision could not be invoked for a period preceding its enforcement, rendering the penalty order without jurisdiction.
The petitioner argued that Section 122(1A) became operative only from 1 January 2021. The impugned penalty related to Assessment Year 2020–21, making retrospective invocation of the penal provision impermissible. The competent officer empowered to exercise powers under Section 122(1A) was appointed only through a Circular dated 27 October 2025, further strengthening the jurisdictional objection.
The petitioner also relied upon the Bombay High Court’s judgment dated 25 February 2026 in Amit Manilal Haria & Ors. v. Joint Commissioner, CGST & Central Excise, where the Court held that Section 122(1A) cannot be retrospectively applied to periods prior to 1 January 2021. The Bombay High Court had observed that Article 20(1) of the Constitution prohibits imposition of penalties under a law that was not in force when the alleged acts were committed.
Opposing the writ petition, the Revenue contended that the petitioner had an effective statutory alternative remedy, and therefore the writ petition ought not to be entertained.
However, the petitioner countered that the challenge was not merely against the correctness of the order but against the very jurisdiction of the authority to invoke Section 122(1A), thereby justifying invocation of the High Court’s writ jurisdiction.
After considering the rival submissions, the Allahabad High Court held that the petition raised a prima facie jurisdictional issue and was therefore maintainable despite the availability of an alternative statutory remedy.
The Court observed that where an order is alleged to have been passed by an authority lacking jurisdiction, the writ petition deserves consideration.
Accordingly, the Court entertained the writ petition, granted four weeks to the respondents to file their counter affidavit, allowed two additional weeks for the petitioner to file a rejoinder, and directed that the matter be listed along with Writ Tax No. 935 of 2026.
Pending further hearing, the Court directed that no coercive action for recovery of the disputed amount shall be taken against the petitioner, subject to the petitioner furnishing an indemnity bond to the satisfaction of the competent authority within ten days.
Membership Required to Access Case Details & Order Copy
To view the complete Case Details and Download Order Copy, you must have an active membership. Please subscribe to continue.
