TaxTMI 
TaxTMI 
TaxTMI 
2025 (11) TMI 240
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.... tune of Rs. 9,81,070/- has been raised against the Petitioner. 4. Submission of Mr. A.K. Babbar, ld. Counsel for the Petitioner is that no personal hearing was granted to the Petitioner and hence, there is violation of principles of natural justice. 5. The matter arises out of the fraudulent availment of Input Tax Credit (hereinafter, 'ITC') wherein an investigation had been initiated against 16 tax payers, who have transferred substantial amounts of ITC through GSTR filing. The scrutiny revealed, as per the Department, that there was hardly any inward ITC from their declared suppliers. This led to the suspicion that 16 firms did not actually exist. The analysis of the outward supplies as reported in GSTR-1M by the previous 72 non-existent firms and another seven firms revealed that the total amount, which was transferred by these firms, was ITC of more than Rs. 122 crores to 1155 taxpayers. 6. The CGST-Delhi, North Commissionerate started the investigation process by giving notices to 1155 recipients, who were associated with 79 fake entities. Some parties paid the amount of approximately Rs.5.24 crores. The Petitioner is at serial number 211 in the impugned order and th....
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....servation on the merits of the case of the respondent. 13. For the above reasons, we allow the appeal and set aside the impugned order of the High Court. The writ petition filed by the respondent shall stand dismissed. However, this shall not preclude the respondent from taking recourse to appropriate remedies which are available in terms of Section 107 of the CGST Act to pursue the grievance in regard to the action which has been adopted by the state in the present case" 9. Thereafter, this Court in W.P.(C) 5737/2025 titled Mukesh Kumar Garg v. Union of India & Ors. dealing with a similar case involving fraudulent availment of ITC had held as under: "11. The Court has considered the matter under Article 226 of the Constitution of India, which is an exercise of extraordinary writ jurisdiction. The allegations against the Petitioner in the impugned order are extremely serious in nature. They reveal the complex maze of transactions, which are alleged to have been carried out between various non-existent firms for the sake of enabling fraudulent availment of the ITC. 12. The entire concept of Input Tax Credit, as recognized under Section 16 of the CGST Ac....
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....ced proportionately in terms of the invoices raised by the Petitioner under his firm or whether penalty is liable to be imposed under Section 122(1) and Section 122(3) of the CGST Act. 18. The persons, who are involved in such transactions, cannot be allowed to try different remedies before different forums, inasmuch as the same would also result in multiplicity of litigation and could also lead to contradictory findings of different Forums, Tribunals and Courts." 10. This position was also followed in M/s Sheetal and Sons & Ors. v. Union of India & Anr., 2025: DHC: 4057-DB. The relevant portion of the said decision read as under: 15. The Supreme Court in the decision in Civil Appeal No 5121 of 2021 titled 'The Assistant Commissioner of State Tax & Ors. v. M/s Commercial Steel Limited' discussed the maintainability of a writ petition under Article 226. In the said decision, the Supreme Court reiterated the position that existence of an alternative remedy is not absolute bar to the maintainability of a writ petition, however, a writ petition under Article 226 can only be filed under exceptional circumstances.... XXXX 16. In view of the fact tha....
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....eing any supply of goods or services. The impugned order in question dated 30th January, 2025, which is under challenge, is a detailed order which consists of various facts as per the Department, which resulted in the imposition of demands and penalties. The demands and penalties have been imposed on a large number of firms and individuals, who were connected in the entire maze and not just the Petitioner. 15. The impugned order is an appealable order under Section 107 of the CGST Act. One of the co-noticees, who is also the son of the Petitioner i.e. Mr. Anuj Garg, has already appealed before the Appellate Authority. 16. Insofar as exercise of writ jurisdiction itself is concerned, it is the settled position that this jurisdiction ought not be exercised by the Court to support the unscrupulous litigants. 17. Moreover, when such transactions are entered into, a factual analysis would be required to be undertaken and the same cannot be decided in writ jurisdiction. The Court, in exercise of its writ jurisdiction, cannot adjudicate upon or ascertain the factual aspects pertaining to what was the role played by the Petitioner, whether the penalty imposed is ....