MHJ Metaltechs Private Limited Vs Central Goods And Services Tax Delhi South (Delhi High Court)
The Delhi High Court considered petitions filed under Article 226 of the Constitution of India by MHJ Metaltech Private Limited challenging an order dated 3 February 2025, which raised demands against the company for allegedly availing fraudulent Input Tax Credit (ITC) under the Central Goods and Services Tax Act, 2017 (CGST Act). The allegations arose from a show cause notice (SCN) issued on 1 August 2024, stating that one individual, Mohit Jain, had orchestrated a network of suppliers to generate goods-less invoices for fraudulent ITC claims. The total GST involved in the alleged scheme exceeded Rs. 155 crores, and ITC claimed by the petitioners was approximately Rs. 7.08 crores. Several entities, including MHJ Metaltech Private Limited, were identified as recipients of ITC passed on through these invoices.
Read SC Judgment: No Interference in ITC Fraud Order; Only Appeal Permitted not Writ: SC
The petitioners submitted replies to the SCN and attended a personal hearing on 3 January 2025. Counsel for the petitioners contended that only one hearing was granted, despite the impugned order noting three, and that the documents relied upon by the department (RUDs) were illegible, constituting a violation of natural justice. The High Court noted, however, that the documents were collected from various firms under investigation and that the department was not obliged to provide retyped copies. Regarding personal hearings, the court observed that notices had been sent for three dates—5 November 2024, 18 December 2024, and 3 January 2025—and that the petitioners had attended one of these hearings. The court emphasized that the CGST Act permits no more than three adjournments for personal hearings and that sufficient opportunity had been accorded.
