Maintainability of writ petitions on fraudulent availment of Input Tax Credit denied; petitioner allowed to pursue statutory appeal where reply may not have been considered.

Maintainability of writ petitions challenging fraudulent availment of Input Tax Credit was addressed by emphasising that extraordinary writ jurisdiction is ordinarily inappropriate where ITC is allegedly obtained through bogus transactions and fake invoicing because such matters require extensive factual and documentary investigation; consequence: the court declined to exercise writ jurisdiction. The court also applied principles of natural justice in noting personal hearing notices and, because there was doubt whether the adjudicating authority considered the petitioner's reply and the statutory appeal period had lapsed, granted the petitioner an opportunity to pursue the statutory appellate remedy. The writ petitions were therefore refused relief.

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Issues: (i) Whether writ jurisdiction under Article 226 should be exercised to entertain petitions challenging orders and show cause notices issued in alleged cases of fraudulent availment of Input Tax Credit, or whether petitioners must be relegated to the alternate statutory remedy under Section 107 of the CGST Act; (ii) Whether petitioners are entitled to relief on the ground that their interim reply and/or request for personal hearing was not considered by the Adjudicating Authority.

Issue (i): Whether writ jurisdiction should be exercised in cases involving alleged fraudulent availment of ITC or whether the remedy under Section 107 is the appropriate forum.

Analysis: The matters involve a complex matrix of connected entities, transactions, seized documents and factual inquiries requiring detailed factual determination, assessment of evidence and consideration of burden on the exchequer. The availability of an alternate, statutory appellate remedy renders writ jurisdiction inappropriate in the absence of established exceptional circumstances such as breach of fundamental rights, violation of natural justice, excess of jurisdiction or challenge to vires of the statute. Prior decisions applying these principles in the context of fraudulent ITC and detailed fact-sensitive investigations are relied upon.

Conclusion: Writ jurisdiction is not to be exercised; petitioners are relegated to pursue the appellate remedy under Section 107 of the CGST Act. This conclusion is against the petitioners and in favour of Revenue.

Issue (ii): Whether petitioners merit relief because an interim reply filed and/or personal hearing was not considered by the Adjudicating Authority.

Analysis: There is a recorded doubt as to whether the interim reply was considered and the personal hearing notices were issued and not complied with by the petitioners. In view of that doubt and to avoid prejudice arising from limitation, a limited procedural opportunity to file the statutory appeal with requisite pre-deposit is appropriate so that the appellate authority can adjudicate the claims on merits.

Conclusion: Petitioners are permitted to file an appeal under Section 107 of the CGST Act with the requisite pre-deposit by 1st February, 2026; such appeal shall not be dismissed on the ground of limitation and shall be adjudicated on merits. This conclusion is partly in favour of the petitioners as a procedural relief.

Final Conclusion: The writ petitions are dismissed and the petitioners are relegated to pursue the statutory appellate remedy under Section 107 of the CGST Act; a time-limited procedural concession to file appeals without limitation bar is granted to address the specific doubt about consideration of the interim reply.

Ratio Decidendi: Where allegations of fraudulent availment of ITC give rise to a complex factual matrix and an alternate statutory appellate remedy exists, writ jurisdiction under Article 226 should not be exercised and the petitioners must be relegated to the statutory appeal under Section 107 of the CGST Act, subject to limited procedural relief where necessary to prevent prejudice.

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