TMI Blog2023 (11) TMI 664X X X X Extracts X X X X X X X X Extracts X X X X ..... h disallowing the input tax credit will affect the beneficiary who availed it and in the present case, M/s.SKMPL in liquidation is the beneficiary and not the petitioners. As against the petitioners, penalty and interest were fastened based on the search conducted and the documents seized at the premises of the petitioners, where it was found that the petitioners had indulged in creation of bogus invoices and they had not at all conducted any business activities and it was concluded that the cotton yarn purchased and sold by the petitioners have not been received in the premises - This Court does not find any violation of principles of natural justice and deprival of any constitutional rights. In such view of the matter, this Court is not i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ton yarn from M/s.Sri Karunambikai Mills Pvt.Ltd. (SKMPL) and M/s.Arun Tex during July 2017 to March 2018 and availed input credit under CGST and SGST and utilized for payment of outward liability of GST. Therefore, the respondents concluded that the cotton yarn purchased and sold by the petitioners have not been received in the premises and thereby, issued a show cause notice dated 5.5.2020 under Section 74 of the CGST/SGST Act to the petitioners. Hence, the ITC availed by the petitioners amounting to Rs. 2,39,61,474/- and 1,98,90,660/- was proposed to be disallowed along with interest and penalty. On 10.09.2020, the petitioners filed a reply to the show cause notice, stating that the purchase and sale made by them were genuine and that ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d selling of cotton yarn from M/s.SKMPL and M/s.Ravi Tex and sell the same to them as per the requirements, they filed GST returns upto 2018 and thereafter NIL returns were filed upto 2019. The petitioners also requested to keep the adjudication proceedings on abeyance till the outcome of the proceedings initiated by the department against SKMPL as the petitioners' transactions are interlinked with SKMPL which is under the liquidation process. The petitioners also filed additional reply on 14.09.2020. However, the respondent passed impugned orders dated 29.09.2020, arriving at a conclusion that the petitioners have not produced transport documents for movement of goods and the frieght charges have not been recorded in the books of accou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Section 74 of the Act is not permissible and hence, the impugned orders are without authority of law and liable to be set aside. 6. Per contra, the learned Standing counsel for the respondents would submit that during search conducted at the registered premises of the petitioners, it was found that the petitioners have not conducted any business activities and it was concluded that the cotton yarn purchased and sold by the petitioners have not been received in the premises and they had indulged in creation of bogus invoices and availed input tax credit (ITC) and utilized for payment of outward liability of GST. He would fairly submit that only input tax credit alone is disallowed against the person who availed the benefit and in the present ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case of the petitioners that no opportunity was afforded during adjudication of the proceedings and passing the impugned orders. This Court does not find any violation of principles of natural justice and deprival of any constitutional rights. In such view of the matter, this Court is not inclined to entertain the Writ Petitions. 9. Accordingly, the Writ Petitions are dismissed. However, considering the fact that as against the impugned orders, there is an efficacious appeal remedy available to the petitioners, without adverting to the grounds raised by the petitioners in respect of the impugned orders, this Court grant liberty to the petitioners to prefer appeals before the appropriate authority within a period of 30 days from the date of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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