The Delhi High Court has refused to entertain the writ petition challenging Show Cause Notice (SCN) alleging fake availment of Input Tax Credit (ITC) as the alternative remedy under Section 107 of the Central Goods and Service Tax Act, 2017 was available.
Section 107 of the Central Goods and Service Tax Act, 2017 stated that any person aggrieved by any decision or order passed by an adjudicating authority may appeal to Appellate Authority as may be prescribed within three months from the date on which the said decision
The bench of Justice Prathiba M. Singh and Justice Rajneesh Kumar Gupta while considering the nature of the matter which involves allegations of availment of fraudulent ITC, did not entertain the writ petition.
The bench directed the Petitioner to avail of its remedies under Section 107 of the Central Goods and Service Tax Act, 2017. If the Petitioner wishes to file an appeal, it may do so by 15th July, 2025 along with the requisite pre-deposit.
This is the second writ petition being filed by the Petitioner. The order herein arises out of a show cause notice which was addressed to several noticees and allegations of fake availment of Input Tax Credit (ITC) were raised therein.
A perusal of the order would show that the Petitioner is alleged to have received goods-less invoices from two firms, namely M/s. Shivaay Trading and Satyam Associates, which are firms stated to be belonging to Mrs. Aaurti Kapoor. The total availment of Input Tax Credit (ITC) is alleged to be to the tune of Rs. 172 Crores through the fake and fraudulent firms and goods-less invoices.
The order shows that there are 34 parties to whom SCN has been issued. In the order itself, the allegation is that one Mrs. Aaurti Kapoor, who is connected to all these firms had passed on the ITC to various entities, such as the Petitioner.
The Petitioner contended that despite the directions for furnishing the Relied Upon Documents, the same were not furnished to the Petitioner until the filing of a contempt petition. It is further submitted that in the RUDs, the statement of one Mr. Vinod Pahwa would show that he does not have any connection with the Petitioner. Thus, there is no document which connects the Petitioner to Mr. Vinod Pahwa or Mrs. Aaurti Kapoor. The order deserves to be quashed.
The Department has pointed out that the GSTR-1M of the various firms of Mrs. Aaurti Kapoor would show that the said firms had made outwards supplies by issuing mere invoices without any supply of goods, only to pass on the ITC.
The court held that 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.
Case Details
Case Title: Standard Cartons Pvt Ltd Versus Office Of The Commissioner Central Tax Delhi West And Ors
Case No.: W.P.(C) 7186/2025 & CM APPL. 32365/2025 & CM APPL. 32366/2025
Date: 26th May, 2025
Counsel For Petitioner: Shivani Sethi
Counsel For Respondent: Shlok Chandra, Sr Standing Counsel
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