Availment of Input Tax Credit on invoices of non-existing dealers denied; writ petitions dismissed after statutory remedy and evidentiary defects

Challenge to assessment under GST concerned availment of input tax credit based on invoices from non-existing dealers. The petitioner failed to respond to show cause notices initiating DRC proceedings and subsequent assessments under Section 74, and an application for rectification of those assessment orders was rejected; accordingly, the writ petitions were held not maintainable and dismissed. The court held that statements of e-way bills alone are insufficient to prove physical receipt of goods or services; delivery challans, receipts and other documentary proof are required to substantiate receipt. Remedy by way of statutory proceedings precluded entertaining the writ petitions.

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Issues: (i) Whether the writ petitions challenging the assessment orders passed under Section 74 of the GST Act and the rejection of rectification applications under Section 161 of the GST Act are maintainable and whether the impugned orders are liable to be set aside.

Analysis: The challenge concerns assessment orders issued after non-filing of replies to show cause notices and allegations that input tax credit was availed on invoices from non-existing dealers. The evidence presented includes e-way bill statements and subsequently produced invoices and e-way bills; however, e-way bill statements alone do not suffice to prove physical receipt of goods. Documentary proof such as delivery challans and receipts are required to substantiate actual receipt. The remedy of rectification under Section 161 and challenges to assessments under Section 74 were considered in the context of available evidence and the appropriate statutory remedy.

Conclusion: The writ petitions are not maintainable on the merits and are dismissed. Liberty is granted to file a statutory appeal before the Appellate Commissioner within thirty days, and if filed the appeal shall be decided on merits and in accordance with law without regard to limitation and without reliance on observations made in this order.

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