Genius Electricals And Electronics Pvt Ltd Vs Additional Commissioner CGST Delhi West & Anr (Delhi High Court)
Delhi High Court has set aside a tax demand of approximately ₹2.8 crore and an equivalent penalty imposed on Genius Electricals And Electronics Pvt Ltd. The court ruled that the order was passed in violation of the principles of natural justice, specifically the right to be heard. The case, Genius Electricals And Electronics Pvt Ltd Vs Additional Commissioner CGST Delhi West & Anr., mandates a fresh hearing for the petitioner.
The case originated from an investigation initiated against multiple entities, including M/s Sri Ram Industries and M/s MICA Industries Ltd., concerning alleged wrongful availment of Input Tax Credit (ITC) and non-payment of Goods and Services Tax (GST). The investigation indicated that a network, reportedly operated by Mr. Vinay Gupta and Mr. Vikas Goel, was creating fake ITC without any underlying goods supply. Genius Electricals And Electronics Pvt Ltd was implicated in this investigation, accused of receiving invoices to illicitly enhance its ITC benefit, leading to the substantial tax demand and penalty.
Mr. Ruchi Bhatia, counsel for the petitioner, informed the court that the company had submitted a detailed reply to the allegations, but this reply was not considered by the Adjudicating Authority. Furthermore, it was highlighted that the notices for personal hearings were either dispatched after the scheduled hearing dates or received by the petitioner post-hearing, effectively denying them an opportunity to present their case.
