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2023 (12) TMI 291 - DELHI HIGH COURTValidity of reversal of Input Tax Credit (ITC) during investigation / search proceedings - Validity of search / inspection conducted at business premises - Allegation of availment of inadmissible ITC and shortage of cash - whether the inspection conducted by the Delhi GST Authorities was illegal for want of proper authorization? - HELD THAT:- If the tax is not paid on self-ascertainment basis, the assessee cannot be extended the benefit of Section 73(6) of the DGST Act or Section 74(6) of the DGST Act. In the present case, the petitioner has stoutly disputed that the reversal of ITC was voluntary. In cases where the payment made during search is not voluntary, the taxpayer is required to be refunded the said deposit while reserving the right of the GST authorities to proceed against the said taxpayer to the full extent in accordance with law - It is also material to note that the respondents have not issued an acknowledgment in FORM GST DRC-04. Thus, the procedure under Rule 142 of Delhi Goods & Services Tax Rules, 2017 (the DGST Rules) has not been followed. In the present case, the petitioner has stoutly disputed that the reversal of ITC was voluntary. Undisputedly, the same has been made while the petitioner’s premises were being searched and he was being subjected to questioning / enquiries - it is not difficult to accept that the petitioner may have found the circumstances intimidating and had, accordingly, agreed to reverse the ITC. The respondents are directed to reverse the ITC amounting to ₹22,14,226/- in the petitioner’s ECL - petition disposed off.
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