2026 (4) TMI 1348

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.... its business premises. During the inspection of the premises by the Assistant Commissioner (CT), it was found that the premises is not sufficient for carrying out the business of this nature, to claim a huge sum as Input Tax Credit on purchase. Hence, show cause notice dated 14/11/2024 was issued to the appellant to furnish details about the actual movement of goods to match the claim of ITC and also to appear in person. The appellant gave detail reply as well as participated in the personal hearing. The Assistant Commissioner (CT), not being satisfied with the explanation and the records furnished by the appellant, ordered cancellation of GST registration vide order dated 29/11/2024. As against the order of the Assistant Commissioner (CT)....

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....aurav Metal between April 2022 and August 2022, sold out about 94% of its stock and the remaining stock kept separately. Later, the partnership running M/s Gaurav Metal got dissolved and its GST surrendered. Whereas, the appellant M/s Shri Balajee Udyog, a proprietorship concern got registered under GST on 05/04/2022, but commenced its business only from September, 2022. In the absence of evidence to prove parallel or overlapping operation or intermingling of stock or common account or wrongful passing of input credit, mechanical blocking of ITC without adjudication under Section 73 or 74 of the Act is arbitrary exercise of power and violative of Article 19(1)(g) of the Constitution of India. 3. Ms.Amirta Poonkodi Dinakaran, learned Gove....

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....ing the reasons. Hence, the appeal ought to be dismissed. 4. The order of the Appellate Authority namely the first respondent speaks volume about the violation committed by the appellant in availing Input Tax Credit. By producing the print-outs of e-way bills, the appellant try to make out a case of genuine transactions, without any proof of movement of goods. Pursuant to the All-India drive against fake registration cases, the illegitimate act of the appellant as well as the fake suppliers have come to light and from the records produced by the Learned Government Advocate, we find that, action initiated against all those suppliers under Section 86A blocking the ITC as well as action under Section 74 of the GST Act contemplated. Therefor....