GST Fraud Cases

The Supreme Court dismissed the SLP filed against the the decision of the Delhi High Court held that the consolidated Show cause notice (SCN) covering multiple financial years is permissible in GST Fraud Cases. The bench of Justice J.B. Pardiwala and Justice K.V. Viswanathan has dismissed a Special Leave Petition filed by Ambika Traders. The Delhi High Court's decision on two key issues related to a GST fraud case. Firstly, a consolidated SCN covering multiple financial years is permissible under Section 74 of the CGST Act, particularly in cases of fraudulent ITC claims, as the law uses the term "for any period" and not "financial year." Secondly, a writ petition is not the appropriate legal forum for challenging factual issues like the denial of cross-examination, especially when an alternative and equally efficacious remedy of statutory appeal is available. The petitioner/assessee was accused of availing fraudulent Input Tax Credit (ITC) over multiple years (FY 2017–18 to 2021–22). The GST department issued a single, consolidated Show Cause Notice (SCN) for this entire period. The petitioner filed a writ petition challenging the consolidated SCN and arguing that the denial of cross-examination of witnesses violated the principles of natural justice. The Delhi High Court had previously dismissed the writ petition. It held that under Sections 74(3) and 74(4) of the CGST Act, notices can be issued "for any period" or "such periods," which is distinct from the term "financial year" used in Section 74(10). The court reasoned that multi-year SCNs are a lawful and practical tool for dealing with fraudulent patterns that span multiple tax periods. On the issue of cross-examination, the court noted that a writ petition is not the appropriate remedy for challenging factual findings or the denial of cross-examination when the petitioner has not yet availed the statutory remedy of appeal. The petitioner filed the SLP before the Supreme Court and but later on stated that he does not want to press the petition. Concequenlty, the Supreme Court dismissed the SLP. Case Details Case Title: Ambika Traders Versus Additional Commissioner Case No.: SLP 23774/2025 Date: 01-09-2025 Counsel For Petitioner: Advocates Rajesh Jain, Rishabh Jain, Ramashish, Avadh Bihari Kaushik Click Here To Read Order Read More: Bail Denied in Dual Accounting Case Involving Alleged GST Evasion Through Parallel Records

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