Parag Garg Vs Common Adjudicating Authority Additional Commissioner of Central Tax (Delhi High Court)
Delhi HC Grants Interim relief against retrospective application GST penalty u/s 122(1A) of CGST Act prior to January 1, 2021
The Hon’ble Delhi High Court in Parag Garg v. The Common Adjudicating Authority, Additional Commissioner of Central Tax, CGST Delhi West [W.P.(C) 5643/2025 dated July 04, 2025] held that no coercive action shall be taken, where penalty under Section 122(1A) of the CGST Act, 2017 was imposed for transactions conducted prior to the enforcement of the said provision.
Facts:
Parag Garg (“the Petitioner”) was subjected to penalty proceedings under Section 122(1A) of the CGST Act, 2017. The Petitioner contended that the provision came into force only from January 1, 2021 and, therefore, cannot be applied to transactions that occurred prior to the said date.
The Court was informed that the taxable person, M/s Sanskriti EXIM Private Limited, had separately challenged the show cause notice and subsequently amended its writ petition (W.P.(C) 929/2025) to challenge the penalty order. The Court noted the similarity of issues between both cases and accordingly directed that they be dealt together.
Issue:
Whether Section 122(1A) of the CGST Act, 2017 can be invoked for imposing penalty in respect of transactions that took place before January 1, 2021, i.e., before the provision came into force?
