Goyal Trading co Vs Union of India And Others (Madhya Pradesh High Court)
Madhya Pradesh High Court, in a recent ruling, has dismissed a writ petition filed by Goyal Trading Co. and other petitioners challenging an order from the Additional Commissioner, Central Goods & Service Tax and Central Excise, Bhopal. The order imposed recovery of Input Tax Credit (ITC), interest, and penalties related to alleged fake/bogus ITC claims. The High Court has directed the petitioners to pursue their statutory appellate remedy under Section 107 of the CGST Act, emphasizing the availability of an efficacious alternative.
The petitioners had approached the High Court under Article 226 of the Constitution of India, arguing that the original order dated December 19, 2024, was passed in gross violation of natural justice. Their primary contention was that they were not allowed to cross-examine witnesses relied upon by the department and that their submissions were not considered. They also questioned the issuance of a common notice for different financial years. This investigation stemmed from intelligence gathered by DGGI, Bhopal, against M/s R.A. Enterprises for allegedly availing and passing on fake ITC amounting to over ₹1.39 crore. Show-cause notices were subsequently issued to 18 entities, including the petitioners, under Section 74 and Section 122(1)(ii) of the CGST Act read with Section 20 of the IGST Act.
