The 100 Most Significant Judgments on Fake ITC Under GST – Part 1 by JurisHour.
At JurisHour, we bring you the judgments on Fake ITC Under GST —a curated list for taxpayers, legal professionals, and GST practitioners.
Our selection process focuses on judgments that:
- Directly impact taxpayers and businesses through clarifications on GST law and compliance.
- Settle critical disputes in tax administration or interpretation of statutes.
- Provide valuable insights for GST lawyers, consultants, and industry leaders.
Table of Contents
The list of 100 judgments will be published in ten parts and this is the first part:
Supreme Court
Case Title: Rajiv Jindal Versus The State Of U.P.
Case No.: Special Leave to Appeal (Crl.) Nos.13548-13550/2024
Fake ITC | The Supreme Court has granted bail to the accused who was involved in 2600 fake firms registration and the input tax credit (ITC) availed with these 2600 Firms was more than Rs. 40,000 Crores.
The bench of Justice Abhay S. Oka and Justice Augustine George Masih has observed that all the offences alleged against the appellants are Magistrate triable offences. Charge-sheet has been filed. Moreover, in the counter, antecedents of the appellants have not been pleaded.
Delhi High Court
Case Title: Kshitij Ghildiyal Versus DGGI
Case No.: W.P.(CRL) 3770/2024
The Delhi High Court while pointing out that the mismanagement of arrest process by Director General of GST Intelligence (DGGI) declared the arrest of person accused of wrongful Input Tax Credit (ITC) availment illegal citing that the grounds of arrest were not communicated to the accused.
The bench of Justice Anish Dayal has relied on the decision of the Supreme Court in the case of Arvind Kejriwal v. Directorate of Enforcement in which it was held that the pre-conditions act as stringent safeguards to protect the life and liberty of individuals.
Bombay High Court
Case Title: PayU Payments Private Limited Versus The Union of India
Case No.: Writ Petition No. 4605 Of 2024 With Interim Application No.3469 Of 2024 In Writ Petition No.4605 Of 2024
The Digital Payment Solution Giant, PayU has challenged the show cause notice (SCN) issued by the Directorate General of GST Intelligence (DGGI) before Bombay High Court. The show cause notice alleges that PayU has availed the wrongful Input Tax Credit (ITC) worth Rs. 38 Crores.
The bench of Justice M.S. Sonak and Justice Jitendra Shantilal Jain while dismissing the petition of PayU asked PayU to file a reply to the show cause notice before the adjudicating authority.
The bench stated that unless the High Court is satisfied that the show cause notice was totally non est in the eyes of law for absolute want of jurisdiction of the authority and to investigate the acts, the writ petition should not be entertained, for mere asking and as a matter of routine. The writ petitioner should merely be directed to respond to the show cause notice and raise all defences and contentions that may be highlighted in the petition.
Allahabad High Court
Case Title: M/S Shyam Sundar Sita Ram Traders Versus State Of U.P. And 2 Others
Writ Tax No. – 991 Of 2021
The Allahabad High Court has held that once registration is granted, the same could be cancelled only in terms of the conditions prescribed under Section 29(2) and allegedly being a bogus firm is not a ground enumerated under Section 29(2).
Jharkhand High Court
Gyaan Chandra Jaiswal Versus Union of India
B.A. No.7209 of 2024
The Jharkhand High Court noted that the allegations made against the petitioner are based on the statement of witnesses. In regard to creating the fake firms, availing and utilizing the ITC to the tune of Rs.54.33 crore, no documentary evidence has been adduced on behalf of the prosecution in support of the allegations made in the complaint and prosecution report as well against the petitioner.
The court while allowing the bail application, took into consideration that the trial of this case is not likely to be concluded in near future and also the fact that the prosecution has not shown any apprehension of tampering the evidence or any flight risk of the petitioner.
Case Title: Satya Prakash Singh Versus The State of Jharkhand
Case No.: A.B.A. No. 2096 of 2024
The Jharkhand High Court has granted anticipatory bail to advocate/tax practitioner who failed to verify the documents for GST registration of a firm which is responsible for wrongfully claiming Input Tax Credit (ITC).
The bench of Justice Anil Kumar Choudhary has observed that it is neither the duty nor the responsibility of the petitioner to verify the documents which were furnished by his client to him and Mr. Pankaj Singh who was representing P.K. Traders went away after taking away all the documents after registration of the proprietary firm.
Kerala High Court
Case Title: A.A Traders Versus The Superintendent
WP(C) NO. 7695 OF 2024
The Kerala High court considering the allegation that the petitioner had obtained the registration and issued fraudulent forged invoices to other parties to claim the input tax credit without conducting any business, the court did not interfere with the order cancelling the registration.
Case Title: Star Roofs And Metals Versus The Assistant Commissioner
Case No.: WP(C) NO. 44100 OF 2024
The Kerala High Court has held that the electronic credit ledger is a wallet, availment of Input Tax Credit (ITC) benefit does not amount to be wrongful.
The bench of Justice Bechu Kurian Thomas relied on the decision in the case of Rejimon Padickapparambil Alex v. Union of India and Others in which it was observed that the electronic credit ledger is in the nature of a wallet with different compartments of Integrated Goods and Services Tax, Central Goods and Services Tax and State Goods and Services Tax and there cannot be any wrong availment of input tax credit merely because a taxpayer had availed the benefit of credit of input tax available in IGST under the heads CGST and SGST.
Orissa High Court
Case Title: M/s. Vedanta Ltd., Jharsuguda Versus UOI
Case No.: W.P.(C) No.24191 of 2024
The Orissa High Court has directed Vedanta to reply to the show cause notice in respect of a sum of ₹8,02,84,232 by which the department claims it to be a wrongly availed input tax credit (ITC).
The bench of Acting Chief Justice Justice Arindam Sinha and Justice M.S. Sahoo has observed that Vedanta petitioner will reply to impugned show-cause notice. In it, Vedanta will be at liberty to take all points, including the point of limitation. The authority says and will pass the order by 5th February, 2025.
Punjab & Haryana High Court
Case Title: Anupam Singla Versus State Of Haryana
Case No.: CRM-M-51963-2024
The Punjab & Haryana High Court has granted the bail to accused involved in raising fake invoices and wrongfully claiming GST ITC.
The bench of Justice Sandeep Moudgil has observed that the petitioner has already suffered sufficient incarceration i.e. 3 years, 2 months and 16 days, similarly situated co-accused have already been granted concession of bail by this Court, and as per the principle of the criminal jurisprudence, no one should be considered guilty, till the guilt is proved beyond reasonable doubt.
