The Delhi High Court while noting that there is a possibility of duplication in GST Demand; allowed the partial pre-deposit for appeal on the allegations of wrongful Input Tax Credit (ITC) availment.
The bench of Justice Prathiba M. Singh and Justice Rajneesh Kumar Gupta has observed that both the orders are appealable orders before the concerned Appellate Authority under Section 107 of the Central Goods and Services Tax Act, 2017. The question of duplication, if any, shall be examined and adjudicated by the Appellate Authority. However, on a prima facie perusal, it appears that the amount pertaining to M/s Nivaran Enterprises has been reflected in both orders, indicating a possible instance of duplication.
The Directorate General of GST Intelligence (DGGI) had received an incident report alleging the fraudulent availment of Input Tax Credit (ITC) by M/s Skylark Infra Engineering Pvt. Ltd to the tune of Rs.5.89 Crores using fake invoices without actual receipt of goods and services. The Skylark Infra had allegedly received invoices issued by six fake firms, which were found to not be operating at their listed addresses.
One among the six firms was M/s Nivaran Enterprises which is alleged to have further passed on the fraudulently claimed ITC to 47 firms including the Petitioner’s firm i.e., M/s Kunj Behari Enterprises.
The Petitioner’s firm was attached as a co-noticee in the concerned Show Cause Notice.
This order arises from Show Cause Notice bearing reference no 325/2024-25 which was issued specifically against the Petitioner’s firm for availing fraudulent ITC from two fake/non-existent firms namely; M/s Nivaran Enterprises and M/s Radhey Enterprises. Vide the said order dated 10th January, 2025 demand to the tune of Rs.55,15,011/- qua ITC availed from M/s Nivaran Enterprises and; Rs. 1412730/- qua ITC availed from M/s Radhey Enterprises was confirmed against the Petitioner’s firm.
The Petitioner contended that the sum of Rs.55,15,012 has been duplicated in both the orders dated 21st January, 2025 and 10th January, 2025, though with a difference of Re.1. It is a clear error by the Department, therefore, the demands are liable to be set aside.
The court directed that the appeal be filed by the Petitioner before the Appellate authority within a period of 30 days. The appeal shall be adjudicated on merits.
Case Details
Case Title: Vipin Kumar Mittal Versus Commissioner Of Central Goods And Services Tax (CGST), Delhi North
Case No.: W.P.(C) 4776/2025 & CM APPL. 22003/2025
Date: 16/04/2025
Counsel For Petitioner: Bhwesh Bhola
Counsel For Respondent: Akash Verma
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