Marginmart Ifosystems Private Limited Vs Assistant Commissioncr CGST (Delhi High Court)
Summary: The Delhi High Court considered W.P.(C) 9013/2026 filed by MarginMart IFOSYSTEMS Private Limited, along with CM APPL. 42192/2026 and CM APPL. 42193/2026, challenging a Show Cause Notice dated 27.09.2025 and the consequential order dated 24.03.2026 passed pursuant thereto.
The impugned order recorded that proceedings under Section 122(1)(ii) of the Central Goods and Services Tax Act, 2017 were initiated against the Petitioner on the allegation that invoices had been issued without actual supply of goods and inadmissible Input Tax Credit had been passed on to M/s Enriche Retail Private Limited. The order further recorded that, during the investigation, M/s Enriche Retail Private Limited was found to be non-existent at its registered place of business, following which the proceedings culminated in the impugned order. The judgment therefore concerned a challenge to GST proceedings arising from allegations of invoices issued without actual supply and passing on of inadmissible ITC.
The Petitioner contended that the Show Cause Notice and consequential order had been issued and passed mechanically and in a predetermined manner, without independent examination qua the Petitioner. It was further submitted that the proceedings were without jurisdiction and violative of the principles of natural justice. On these grounds, the Petitioner urged the High Court to exercise its extraordinary writ jurisdiction under Article 226 of the Constitution of India.
The Court noted that the Petitioner admittedly had an efficacious statutory remedy of appeal under Section 107 of the CGST Act. The Court held that the contentions raised by the Petitioner, including the challenges concerning the manner in which the proceedings were initiated and decided, could appropriately be examined by the Appellate Authority in proceedings under Section 107.
Accordingly, the Delhi High Court declined to entertain the writ petition in view of the availability of the statutory appellate remedy. The Court expressly stated that it was not expressing any opinion on the merits of the contentions raised by the Petitioner. The Petitioner was relegated to avail the remedy of appeal before the competent Appellate Authority, if so advised.
The Writ Petition was consequently disposed of with liberty to the Petitioner to avail the statutory remedy in accordance with law. The Court further clarified that it had not expressed any opinion on the merits of the controversy and that all questions were left open for consideration by the Appellate Authority.
The order therefore does not finally adjudicate the allegations concerning invoices, actual supply, inadmissible ITC, jurisdiction or natural justice. Those issues were expressly left open for consideration by the statutory Appellate Authority. The Court’s disposition was confined to declining writ intervention because an efficacious statutory appeal under Section 107 was available.
FULL TEXT OF THE JUDGMENT/ORDER OF DELHI HIGH COURT
1. Through the present Petition, the Petitioner seeks issuance of a writ in the nature of certiorari for quashing the Impugned Show Cause Notice dated 27.09.2025, and the consequential Impugned Order dated 24.03.2026 passed pursuant thereto.
2. The Impugned Order records that proceedings under Section 122(1)(ii) of the Central Goods and Services Tax Act, 2017 [„the Act‟] were initiated against the Petitioner on the allegation that invoices were issued without actual supply of goods and that inadmissible Input Tax Credit was passed on to M/s Enriche Retail Private Limited. It further records that, during the course of investigation, M/s Enriche Retail Private Limited was found to be non-existent at its registered place of business, and on that basis the proceedings culminated in the passing of the Impugned Order.
3. Admittedly, the Petitioner has an efficacious statutory remedy of appeal under Section 107 of the Act.
4. Learned counsel representing the Petitioner submits that the Impugned Show Cause Notice as well as the consequential Impugned Order have been issued and passed in a mechanical and pre-determined manner, without any independent examination qua the Petitioner. It is further submitted that the proceedings are without jurisdiction and are also violative of the principles of natural justice. On these grounds, it is urged that this Court ought to exercise its extraordinary writ jurisdiction under Article 226 of the Constitution of India.
5. The aforesaid contention, as also all other grounds sought to be urged by the Petitioner, can appropriately be examined by the Appellate Authority in proceedings under Section 107 of the Act.
6. In view of the availability of the aforesaid statutory remedy, and without expressing any opinion on the merits of the contentions raised by the Petitioner, this Court is not inclined to entertain the present Writ Petition. The Petitioner is relegated to avail the remedy of appeal before the competent Appellate Authority, if so advised.
7. Accordingly, the Writ Petition stands disposed of with liberty to the Petitioner to avail the statutory remedy in accordance with law.
8. It is clarified that this Court has not expressed any opinion on the merits of the controversy, and all questions are left open to be considered by the Appellate Authority.
