GST | Liability of Retired Partner Continues Until Statutory Intimation is Given to Commissioner – Punjab & Haryana High Court

Court Refuses to Interfere in GST Recovery; Dismisses Writ Petition Citing Section 90 of CGST Act. Punjab and Haryana High Court upheld recovery proceedings and land attachment initiated against a former partner of a firm for GST dues of ₹37,84,228, holding that under Section 90 of the Central Goods and Services Tax Act, 2017, a partner remains jointly and severally liable for tax until written intimation of retirement is given to the Commissioner. The Division Bench of Justice Lisa Gill and Justice Sudeepthi Sharma dismissed the writ petition, granting the petitioner liberty to avail the statutory appellate remedy.

Harvinder Singh, a partner in M/s Foreigners Auto Zone, claimed to have retired from the firm on 20 April 2021. The firm subsequently incurred GST liabilities for the assessment year 2023–24.

A DRC-07 order dated 6 May 2024 assessed tax dues of ₹37.84 lakh under Section 73 of the Punjab GST Act, 2017, the CGST Act, and Section 20 of the IGST Act. When the dues remained unpaid, recovery proceedings under Section 79 PGST Act were initiated, including a red entry in the land records attaching the petitioner’s share in agricultural land.

The petitioner contended that the GST liability arose after his retirement, and that it was the firm’s responsibility—not his—to intimate the authorities about the change in partnership. He claimed the delay in intimation (finally made on 28 February 2025) was due to lack of access to the GST portal.

Whether a retired partner remains liable for GST dues in absence of timely intimation of retirement?

The Court emphasized the plain wording of Section 90 of the CGST Act, which provides:

“If no such intimation is given within one month from the date of retirement, the liability of such partner… shall continue until the date on which such intimation is received by the Commissioner.”

Since the intimation was given almost four years later, the Court held the petitioner’s liability continued for the intervening period. The Court rejected the plea that the firm alone bore the duty to intimate the authorities.

Maintainability of the writ petition in view of statutory remedy

The Bench noted that under Section 107 of the PGST Act, the petitioner had an efficacious appellate remedy to challenge the assessment and recovery orders. Reiterating the principle that writ jurisdiction should not be invoked where statutory remedies exist unless exceptional circumstances are shown, the Court found no such circumstances in this case.

The petitioner’s objection to the attachment was dismissed. The Court found the red entry under the Punjab Land Revenue Act, 1887, and the recovery steps under Section 79 PGST Act lawful, as they were based on subsisting liability under GST records, where the petitioner was still reflected as an active partner.

“In the given factual matrix, it cannot be concluded that petitioner is not liable under the Act, especially in view of categoric provision of Section 90 of the CGST Act, 2017.”

The High Court dismissed the writ petition, refusing to quash the recovery proceedings or the land attachment. However, liberty was granted to the petitioner to pursue remedies available under law, particularly the statutory appeal.

Date of Decision: 18 July 2025