Mahavir Metal House Vs Additional Commissioner (Delhi High Court)
Delhi High Court has dismissed a petition filed by M/s Mahavir Metal House, challenging an Order-in-Original that raised demands and penalties for alleged fraudulent Input Tax Credit (ITC) availment. The court emphasized the existence of a statutory appellate remedy and the limited scope of writ jurisdiction in such cases.
The petitioner, Mahavir Metal House, had approached the High Court under Article 226 of the Constitution of India, seeking to quash the impugned order dated February 1, 2025. This order stemmed from a Show Cause Notice (SCN) issued on June 11, 2024, alleging that the petitioner had fraudulently availed ITC amounting to Rs. 2,38,062.
Petitioner’s Grounds for Challenge
Learned Counsel for the petitioner presented two primary arguments against the impugned order:
1. The SCN and the subsequent impugned order were issued by different authorities.
2. A consolidated SCN had been issued for multiple financial years, an issue that is currently under consideration by the High Court in a separate case titled WP (C) 4392/2025, Quest Infotech Pvt. Ltd. & Anr. v. Union of India.
Court Underscores Limits of Writ Jurisdiction
The High Court, in its deliberation, underscored the well-established legal position regarding the maintainability of writ petitions, particularly when an alternate statutory remedy is available. The court cited the Supreme Court’s ruling in Civil Appeal No. 5121/2021, Assistant Commissioner of State Tax and Ors. v. M/s Commercial Steel Limited. This landmark judgment stipulated that a writ petition under Article 226 should only be entertained in “exceptional circumstances,” specifically when there is:
- A breach of fundamental rights.
- A violation of the principles of natural justice.
- An excess of jurisdiction.
- A challenge to the vires of a statute or delegated legislation.
The Supreme Court in Commercial Steel Limited had observed that in that particular case, none of these exceptions were established, and it was inappropriate for the High Court to entertain a writ petition. The assessment of facts, it held, should be carried out by the appellate authority. This legal stance was also reiterated by the Allahabad High Court in Writ Tax No. 753 of 2023, Elesh Aggarwal v. Union of India, which stated that no grounds for interference on merits were made out in the exercise of extraordinary jurisdiction.
