2025 (5) TMI 295 - HC - GST

Wrongful availment of Input Tax Credit (ITC) linked to a fake ITC generation network - seeking an opportunity of hearing before the adjudicating authority - delivery of personal hearing notice - HELD THAT - In so far as the delivery of personal hearing notice is concerned a perusal of the hearing notices and the dispatch dates would show that the same was dispatched after the hearing was held by the Adjudicatory Authority CGST West. The Petitioner s replies which have been placed on record show that the Petitioner has raised grounds to dispute the demand and the liability. The Petitioner deserves to be heard before the Adjudicating authority. Accordingly the demand and the penalty qua the Petitioner are set aside - Petition allowed.

Summary

The Delhi High Court, under Articles 226 and 227 of the Constitution, allowed the writ petition challenging the impugned order dated 05.02.2025 by the Additional Commissioner, CGST Delhi West, which imposed a tax demand and equivalent penalty of Rs. 2.8 crores on the Petitioner for alleged wrongful availment of Input Tax Credit (ITC) linked to a fake ITC generation network. The Petitioner contended that its detailed replies were not considered and that personal hearing notices were dispatched or received after the hearing date, depriving it of the opportunity to be heard. The Court noted that the Petitioner had mistakenly sent replies to incorrect authorities and that the personal hearing notices were indeed dispatched post-hearing. Emphasizing the Petitioner's right to be heard, the Court held that "the Petitioner deserves to be heard before the Adjudicating authority" and accordingly set aside the demand and penalty. The Petitioner was directed to appear before the Adjudicating Authority with its replies and materials, and the Authority was mandated to hear the Petitioner and pass a reasoned order within three months. The writ petition was allowed and disposed of accordingly.