TaxTMI 
TaxTMI 
2025 (8) TMI 851
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....9-20. 2. The brief facts of the case are as under: 2.1 The petitioner is a proprietorship concern engaged into dealing in articles and articles of gold in powder form on wholesale basis as contemplated under HSN Code No. 7114 and 7106 respectively. 2.2 The petitioner is registered under the provisions of the GST Act with effect from 01.07.2017 and is maintaining the books of accounts and has also uploaded all the requisite returns timely with respect to the purchase and sale of goods on the E-portal i.e. GSTIN. 2.3 It is the case of the petitioner that the respondent cancelled the registration of the petitioner with effect from 31.03.2022 upon the application made by the petitioner and order to that effect was passed on 12.05.2022 in Form GST REG-19 with 'Nil' liability. 2.3 The petitioner, thereafter, received intimation in Form GST DRC-01A dated 14.05.2024 for the Financial Year 2019-20 under Sec. 74(5) of the GST Act read with Rule 142(1A) of the GST Rules. After scrutiny of the returns filed by the petitioner in Form GSTR-3B, GSTR-01, GSTR-2A, GSTR-9 and E-way bill data, it was found that the tax has not been paid or short paid or input tax credit has been wrongl....
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....vide letter dated 14.04.2025 informed the respondent for allowing the Input Tax Credit as the petitioner has availed the same on purchase made from the suppliers when the GST registration number was in force. The petitioner, by relying upon various decisions cited in the reply, submitted that as per the settled legal position, the Input Tax Credit claimed by the petitioner ought to have been allowed and the proceedings initiated against the petitioner should be dropped. 2.9 It appears that, thereafter, the impugned Order-in-Original dated 13.06.2025 was passed in Form GST DRC-07 by the respondent with the details considering the reply filed by the petitioner on 18.06.2024, 21.06.2024 and 24.06.2024 along with purchase ledger invoice and proof of bank payments. As the petitioner did not agree to reverse the inadmissible Input Tax Credit availed on the basis of the bogus suppliers, it was further recorded in the impugned order that the petitioner failed to provide evidence of actual physical movement of goods for the purchases made, though specifically asked by the respondent in the show-cause notice. 3. Being aggrieved, the petitioner has preferred this petition to quash and s....
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....bespeaks of the facts that do not form part of the notice. 4.4 In support of his submissions, reliance was placed on a decision of the Hon'ble Allahabad High Court in the case of Vadilal Enterprises Ltd vs. State of U.P., reported in [2025] 175 taxmann.com 784 (Allahabad), wherein, the Hon'ble Allahabad High Court has held that in view of the provision of Sec.73 when the respondent have sought further explanation and not a word has been indicated that the petitioner has committed fraud, has given wilful misstatement or has suppressed material facts, which are the ingredients based on which provisions of Sec. 74 of the Act can be invoked, and therefore, the jurisdiction exercised by the respondent to issue the notice under Sec. 74 of the Act lacks requisite ingredients in the notice. 4.5 It was submitted that in the impugned order in para 4, the respondent has referred to the Inspection Report by the officers at the business premises of the firms and other documentary evidence. However, such documents referred to in para 4 of the impugned order have not been provided to the petitioner and if such documents would have been provided, the petitioner could have justified the same ....
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.... non-payment of the tax by such suppliers to the government and after examining the facts of each of the supplier in the impugned order, the respondent has held that the petitioner has failed to satisfy and provide the details of the movement of the goods. It is pertinent to note that the petitioner is dealing in precious metals and it would be necessary for the petitioner to satisfy the respondent with regard to the physical delivery or movement of the goods and in absence of such documents, the respondent was just in passing the impugned order. These observations are made by us in light of the contention raised by the petitioner and they are required to be further verified by the Appellate Authority and they may not be treated as conclusive as we are relegating the petitioner to avail the alternative efficacious remedy. 5.2 The above observations are made by us only to discard the contention of the petitioner that there is a violation of the principles of natural justice for not providing the documents in light of the decision in the case of Agmotex Fabrics Limited (supra), as well as in the case of Vadilal Enterprises Limited (supra), wherein, the contention with regard to as....