AMBIKA TRADERS THROUGH PROPRIETOR GAURAV GUPTA v. ADDITIONAL COMMISSIONER, ADJUDICATION DGGSTI, CGST DELHI NORTH
High Court, Delhi
Prathiba M. Singh, Justice & Rajneesh Kumar Gupta, Justice
AMBIKA TRADERS THROUGH PROPRIETOR GAURAV GUPTA
v.
ADDITIONAL COMMISSIONER, ADJUDICATION DGGSTI, CGST DELHI NORTH
W.P.(C) 4853/2025, CM APPL. 22194/2025 & CM APPL. 22195/2025 dated 29.07.2025
Law : GST
Act Name : Central Goods & Service Tax Act, 2017 & Integrated Goods & Service Tax Act, 2017
Relevant Section : Section 50, 73, 74, 75, 107, 122 & 168 & Section 20
Notification/Circular : Circular No. 171/03/2022-GST dated 06.07.2022
Decision : In favour of assessee
Demand – Interest & penalty – Fraudulent ITC availment – Non-existent/fake firms – Non-consideration of replies – Violation of principles of natural justice – Consolidated SCN for multiple financial years – Cross-examination denial – Reply failed to contest investigation findings or provide business details like goods nature and quantities – Adjudicating authority passed Order confirming entire demand with equivalent penalty and further penalty of ₹75,000 – Corrigendum issued to rectify clerical error in penalty – Petitioner contended replies ignored amounting to violation of Section 74(9) of CGST Act – Reliance placed on CBIC Circular No. 171/03/2022-GST dated 6.7.2022 stating in absence of actual supply demand under Sections 73/74 unsustainable, only penalty under Section 122 applicable – In fraudulent ITC cases genuine businesses must demonstrate actual transactions – Adjudicating Authority conclusion not arbitrary – Fraudulent ITC patterns require connecting transactions across multiple financial years as purchases shown in one year and supplies in next – Solitary transactions insufficient to establish fraud – Consistent patterns through series analysis necessary – Statutory provisions use “period/periods” indicating cross-year investigations – No prejudice from cross-examination denial when documents recovered from petitioner’s premises and petitioner aware of supplier/purchaser status – High Court writ jurisdiction limited and cannot reappreciate evidence or interfere with factual findings – Held: Writ petition disposed – Petitioner to file reply by 31.08.2025 alongwith pre deposit – Cost of Rs 25,000 paid to Delhi High Court Bar Association
Represented By:
Counsel for the Petitioner: Rajesh Jain, Rishabh Jain, Virag Tiwari, Ramashish & Tanya Saraswat, Advocates.
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