Quashing of FIR refused where GST violations and forgery allegations disclosed a triable case requiring evidence.

Allegations of wrongful input tax credit and issuance of invoices without actual supply were treated as potentially falling within both GST offences and penal offences such as cheating and forgery. The High Court held that, at the quashing stage, the record did not permit a final finding that the dispute was only a tax irregularity or that statutory GST machinery alone governed the matter. Because the allegations disclosed cognizable offences and the factual distinction required appreciation of evidence, the FIR was not quashed and the accused was left to raise all defences before the trial court.

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Issues: (i) Whether the FIR was liable to be quashed at the threshold on the ground that the dispute arose out of alleged GST violations and the statutory machinery under the GST law had not been followed; (ii) Whether the allegations disclosed cognizable offences under the penal law or under the GST regime so as to warrant interference in exercise of inherent jurisdiction.

Issue (i): Whether the FIR was liable to be quashed at the threshold on the ground that the dispute arose out of alleged GST violations and the statutory machinery under the GST law had not been followed.

Analysis: The petition rested on the contention that the allegations, at their highest, related to wrongful availment of input tax credit and issuance of invoices without actual supply, matters which fall within the GST framework. The statutory scheme under the GST law, including the provisions governing wrongful availment of input tax credit and the procedure for intimation, notice and adjudication, was considered relevant. However, the Court found that the material did not permit a clear conclusion at the quashing stage that the case was confined only to a tax irregularity. The distinction between a bona fide trader with disputed transactions and a person allegedly using forged documents from the outset could not be conclusively determined without trial.

Conclusion: The FIR could not be quashed on this ground at the threshold.

Issue (ii): Whether the allegations disclosed cognizable offences under the penal law or under the GST regime so as to warrant interference in exercise of inherent jurisdiction.

Analysis: The Court held that the allegations, if accepted on their face, were capable of attracting either the penal provisions relating to cheating and forgery or the GST offence concerning issuance of invoices without supply of goods or services leading to wrongful input tax credit. The Court applied the settled restraint governing quashing, emphasizing that it cannot undertake a mini-trial or assess the reliability of accusations where investigation is complete, charge has already been framed, and the matter is pending evidence. Since the factual matrix was not capable of being resolved finally in a quashing petition, and the allegations disclosed cognizable offences, interference was unwarranted.

Conclusion: The allegations disclosed a triable case and did not justify quashing of the FIR.

Final Conclusion: Inherent jurisdiction was declined, and the petitioner was left to urge all available defences before the trial court at the appropriate stage.

Ratio Decidendi: Where the allegations in an FIR disclose a triable dispute capable of falling either under the penal law or under the GST offence provisions, and the factual distinction cannot be resolved without appreciation of evidence, the High Court should not quash the FIR in exercise of inherent powers.

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