TaxTMI 
TaxTMI 
TaxTMI 
2025 (11) TMI 664
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....he Gurugram Zonal Unit of the Directorate General of GST Intelligence (hereinafter "DGGI") that five exporter firms namely M/s. S.R. Impex, M/s. S.R. International, M/s. RK Enterprises, M/s. Vikas Impex, and M/s. SK Traders, were fraudulently availing Input Tax Credit (hereinafter "ITC"). An investigation and search was conducted in respect of the said exporters and their major suppliers which included the Petitioner. 4. In respect of the Petitioner, the allegations raised were that the Petitioner had issued invoices to one M/s. SM Enterprises, and the said firm on the basis of the said invoices availed ITC credit of Rs. 89 lakhs. However, upon conducting a search at the registered office of M/s. SM Enterprises it was found that the same was a non-existing firm. Further, the statement of the authorised representative of the Petitioner was also recorded during the course of investigation, wherein it was admitted that the invoices were issued to M/s. SM Enterprises, however, the goods were delivered to other locations. 5. Accordingly, tax demand on goods cleared clandestinely has been confirmed in the following terms and penalty has also been imposed: "(i) I confirm th....
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....consider the burden on the exchequer as also the nature of impact on the GST regime, and balance the same against the interest of the Petitioners, which is secured by availing the right to statutory appeal. 9. It would be apposite to refer to some of the cases which have been decided by the Supreme Court as also by this Court on these aspects. The Supreme Court in the context of Central Goods and Service Tax Act, 2017, has, in Civil Appeal No. 5121/2021 dated 3rd September, 2021 titled 'The Assistant Commissioner of State Tax & Ors. v. M/s Commercial Steel Limited', has held as under: "11. The respondent had a statutory remedy under section 107. Instead of availing of the remedy, the respondent instituted a petition under Article 226. The existence of an alternate remedy is not an absolute bar to the maintainability of a writ petition under Article 226 of the Constitution. But a writ petition can be entertained in exceptional circumstances where there is: (i) a breach of fundamental rights; (ii) a violation of the principles of natural justice; (iii) an excess of jurisdiction; or (iv) a challenge to the vires of the statute o....
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.... of writ petitions that this facility under Section 16 of the CGST Act has been misused by various individuals, firms, entities and companies to avail of ITC even when the output tax is not deposited or when the entities or individuals who had to deposit the output tax are themselves found to be not existent. Such misuse, if permitted to continue, would create an enormous dent in the GST regime itself. 14. As is seen in the present case, the Petitioner and his other family members are alleged to have incorporated or floated various firms and businesses only for the purposes of availing ITC without there being 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 Gar....
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.... burden on the exchequer and the nature of impact on the GST regime, writ jurisdiction ought not to be exercised in such cases. The relevant portions of the said judgment are set out below: "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 Act is for enabling businesses to get input tax on the goods and services which are manufactured/supplied by them in the chain of business transactions. The same is meant as an incentive for businesses who need not pay taxes on the inputs, which have already been taxed at the source itself. The said facility, which was introduced under Section 16 of the CGST Act is a major feature of the GST regime, which is business friendly and is meant to enable ease of doing busines....