TMI BlogITC denied if buyer having knowledge of investigation going on against his supplierX X X X Extracts X X X X X X X X Extracts X X X X ..... ITC denied if buyer having knowledge of investigation going on against his supplier - By: - CA Bimal Jain - Goods and Services Tax - GST - Dated:- 18-8-2022 - - The Hon ble High Court of Madhya Pradesh in the matter of M/S. DHARA ENTERPRISES VERSUS APPELLATE AUTHORITY JOINT COMMISSIONER, STATE TAX, SAGAR DIVISION SAGAR (M.P.) ASSISTANT COMMISSIONER, STATE TAX, TIKAMGARH CIRCLE [2022 (6) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... TMI 763 - MADHYA PRADESH HIGH COURT] has upheld the order passed by the Revenue Department imposing the tax liability on the assessee is valid on the ground that the assessee was well aware with the transaction alleged as ineligible on which the benefit of Input Tax Credit ( ITC ) was availed by him. Facts: M/s Dhara Enterprises ( the Petitioner ) has engaged in the business ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Ferrous waste and scrap and is registered under the provisions of the Goods and Services Tax Act, 2017 ( the CGST Act ) . A Show Cause N otice ( SCN ) was served imposing the tax liability along with the penalty on the Petitioner. Thereafter, the Petitioner preferred an appeal before the Appellate Authority ( the Respondent ) wh o vide order ( the I mpugned O rd ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er ) dismissed the appeal. Hence the Petitioner had filed this Petition praying to quash the Impugned order. Petitioner s Contention: There is gross violation of the principle of natural justice, while issuing the SCN , when the authorities alleged that the P etitioner had availed some ineligible I TC, then they should have disclosed the transactions on which s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uch benefit was availed by the P etitioner. It came to know for the first time, on passing of Impugned order that the transactions were in respect of inward supply received from one M/s V.K. Enterprises, Chhatarpur ( the Supplier ) and liability under Section 74 of the CGST Act was fastened upon the Petitioner. Respondent s Contention: The Petitioner had ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... availed the benefit of some ineligible ITC on inward supply from the S upplier and accordingly in the SCN the amount of the ITC availed by the P etitioner were clearly mentioned. The P etitioner was well aware about the details of transaction for which, the liability was being fastened upon the Petitioner and hence present Petition deserves to be dismissed. Issu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e: Whether the P etitioner was right in availing credit when he was having the knowledge that the transactions with its supplier were under investigation? Held: The Hon ble High Court of Madhya Pradesh in M/S. DHARA ENTERPRISES VERSUS APPELLATE AUTHORITY JOINT COMMISSIONER, STATE TAX, SAGAR DIVISION SAGAR (M.P.) ASSISTANT COMMISSIONER, STATE TAX, TIKAMGARH CIRCLE ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... [2022 (6) TMI 763 - MADHYA PRADESH HIGH COURT] has held as under: The P etitioner did not file any reply to the SCN but has made an attempt to demonstrate that he sought documents from the R espondent to have some clarity on the issue, but those documents were not supplied to the Petitioner and hence for want of those documents, the P etitioner could not file reply. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Noted that, before passing the Impugned order, the Petitioner had submitted his reply in which, the Petitioner itself had disclosed the transaction with regard to the S upplier and along with the reply, the P etitioner had also annexed the relevant documents pertaining to transactions i.e. copy of bill, e-way bill. The Petitioner was well aware about the transaction for which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the notice was issued to it . Thus, apparently, the Petitioner has made futile attempt to lay foundation by raising a ground that he was not informed regarding the transactions. Opined that the petition filed by the Petitioner is grossly misconceived as the grounds are ill founded. The P etitioner was in the knowledge that the transactions with S supplier were under scanner. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Held that, there is no substance in the present writ petition and accordingly the same stands dismissed with cost of Rs.2000/- in favour of the Respondent. (Author can be reached at info@a2ztaxcorp.com ) - - Scholarly articles for knowledge sharing authors experts professionals Tax Management India - taxmanagementindia - taxmanagement - taxmanagementindia.com - TMI - T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... axTMI - TMITax ..... X X X X Extracts X X X X X X X X Extracts X X X X
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