Plea Against Constitutional Validity of GST S.16(2) Rejected: Karnataka HC Directs to Pursue Statutory Appeal Against Demand Order

The Karnataka High Court has rejected a plea that challenged the constitutional validity of Section 16(2) of the GST Act. This section outlines the conditions that a taxpayer must fulfill to be eligible to claim Input Tax Credit (ITC). The petitioner had argued that some of these conditions were unconstitutional. However, the High Court, without going into the merits of the constitutional challenge, directed the petitioner to first exhaust the statutory remedy of appeal available against the demand order that had been issued to them. The court observed that the petitioner had a viable alternative remedy in the form of an appeal before the GST appellate authority, where they could raise all their objections. The High Court's decision reinforces the judicial principle of exhausting statutory remedies before approaching a higher court with a writ petition, especially on matters challenging the validity of a law.