Input tax credit denied for fictitious dealers and unreliable transport records failing to prove genuine purchases.

Input tax credit was denied where the assessee failed to prove genuine purchases from real selling dealers and the supporting records did not establish actual movement of goods. The authorities found the alleged dealers to be fictitious or non-existing, their stated business premises untraceable, and the invoices and transport particulars unreliable, including inconsistent vehicle numbers and missing mandatory e-Sugam documents for movement of iron and steel. On these factual findings, the burden of proving entitlement to credit was not discharged, and credit could not be sustained on the basis of fake or unproved transactions. The rejection of the input tax credit claim was upheld.

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Issues: Whether the assessee was entitled to input tax credit on purchases claimed to have been made from registered dealers when the authorities found the selling dealers to be fictitious or non-existing and the transport documents and vehicle particulars were inconsistent.

Analysis: The input tax credit claim was examined against the factual finding that the alleged selling dealers had no genuine place of business, were not traceable at the declared addresses, and were shown by enquiry to be non-existent. The invoices and movement records were further found unreliable because the vehicle registration particulars corresponded largely to non-transport vehicles or incorrect numbers, and the goods were not supported by the mandatory e-Sugam documents required for movement of iron and steel. In these circumstances, the materials relied upon by the assessee did not establish a genuine purchase transaction or discharge the burden of proving entitlement to the claimed credit. The earlier decisions relied upon by the Tribunal were applied on the footing that credit cannot be sustained on the basis of fake or unreliable invoices supported by unproved transactions.

Conclusion: The assessee was not entitled to input tax credit and the rejection of the claim was upheld.

Final Conclusion: The revision petition failed, and the Tribunal's refusal to grant relief to the assessee was sustained.

Ratio Decidendi: Input tax credit cannot be allowed where the dealer fails to prove genuine purchases from real selling dealers and the supporting documents and transport particulars do not establish actual movement of goods.

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