Shyama Power India Ltd. Vs State of H.P. & Ors. (Himachal Pradesh High court)
1. Key Facts of the Case:
- The petitioner, Shyama Power India Ltd., is engaged in the construction of transmission lines and sub-stations.
- An audit under Section 65 of the GST Act was initiated for FY 2017-18 and 2018-19.
- Audit memos raised objections regarding alleged wrong availment of ITC of ₹1.11 crore on purchases from three Delhi/UP-based suppliers.
- The petitioner provided extensive documentary evidence, including bank statements, purchase orders, transporter affidavits, and reconciliations, to refute the allegations.
- Despite this, the department issued a discrepancy notice under Rule 101(4), demanding reversal of ITC with interest and penalty.
- Under continuous pressure, the petitioner reversed the ITC amount of ₹1,11,45,134/- under protest on March 31, 2023, using Form DRC-03 (partly in cash and partly through credit).
- Subsequently, on December 2, 2023, the department passed a final order under Section 74, levying penalty and interest, on the premise that the tax had already been “admitted” and deposited.
- The petitioner was unable to dispute the tax demand in appeal because DRC-07 showed nil tax liability (due to the “admitted” payment), leaving them no option but to file a writ petition.
2. Issues Raised:
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