Section 74 proceedings and Amnesty Scheme relief considered for alleged input tax credit dispute

Challenge to proceedings initiated under Section 74 concerned alleged fraudulent input tax credit based on suppliers' registrations being retrospectively cancelled. The HC noted the petitioner's request to treat the uploaded show-cause notice as part of the writ petition and considered the impending expiry of the Amnesty Scheme under Section 128A. It permitted the writ petition to be heard and granted liberty to apply for the Scheme's benefit by treating the notice as one under Section 73, while making all further steps subject to the result of the writ petition and reserving the parties' rights and contentions.

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Issues: Whether the writ petition challenging initiation of proceedings under Section 74 could be entertained, and whether the petitioner could be permitted to seek the benefit of the Amnesty Scheme under Section 128A by treating the show-cause notice as one under Section 73.

Analysis: The petition questioned the sustainability of proceedings initiated under Section 74 in the context of alleged fraudulent availment of input tax credit from suppliers whose registrations had been cancelled retrospectively. The Court noted the petitioner's request to treat the uploaded show-cause notice as part of the writ petition and also considered the impending expiry of the Amnesty Scheme introduced under Section 128A. On that basis, the Court held that the writ petition should be heard and that the petitioner should be afforded liberty to apply for the benefits of the Amnesty Scheme without prejudice to the parties' rights and contentions.

Conclusion: The petitioner was permitted to seek the Amnesty Scheme benefit by treating the show-cause notice as one under Section 73, while all further steps were kept subject to the result of the writ petition.

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