Case Law Details
Kamal Ideal Infratech Private Limited Vs Union of India & Ors. (Supreme Court of India)
The matter arose from proceedings initiated under the Central Goods and Services Tax Act, 2017 (CGST Act), wherein the petitioner sought to challenge an order dated 07.11.2023 passed under Section 74 of the CGST Act, along with Form ASMT-10 dated 27.01.2023 and the show cause notice in Form GST DRC-01 dated 09.08.2023. The litigation culminated in a judgment of the Punjab and Haryana High Court, followed by dismissal of the Special Leave Petition by the Supreme Court.
Read HC Judgment in this case: GST Writ Petition Dismissed as Delay & Laches Barred Relief: P&H HC
The petitioner, a company engaged in construction and infrastructure development and registered under the CGST Act and the Haryana GST Act, stated that it had availed Input Tax Credit (ITC) in October 2017 and discharged its output tax liability in March and April 2018. Subsequently, Form ASMT-10 dated 27.01.2023 was issued alleging discrepancies in the ITC claimed. This was followed by a show cause notice under Section 74 of the CGST Act. The petitioner claimed that it did not become aware of these electronic communications because its accountant suddenly fell ill, resulting in failure to access notices uploaded on the GST portal. According to the petitioner, it became aware of the proceedings only in 2024 after appointing a full-time accountant, and thereafter filed a writ petition in November 2025 challenging the notices and the order.
Before the High Court, the petitioner argued that there had been a violation of the principles of natural justice because Form ASMT-10 and the show cause notice were not physically served. It submitted that due to post-COVID business disruption and the illness of its accountant, it failed to monitor communications uploaded on the GST portal. It also contended that it had already discharged its tax liability, that the proceedings were time-barred, and that Section 74 had been wrongly invoked as there was no fraud, wilful misstatement or suppression of facts.
The respondents opposed the writ petition, submitting that the petitioner had admitted receipt of the notices, had never filed any reply, and had not availed the statutory appellate remedy against the order dated 07.11.2023 before approaching the High Court in November 2025.
The High Court noted that Form ASMT-10 alleged discrepancies including mismatch between ITC claimed in GSTR-3B and ITC reflected in GSTR-2A, issues regarding ITC reversal, transitional CENVAT credit, ITC claimed in GSTR-9, non-uploading of audited accounts with GSTR-9C, and non-payment of late fee and interest. The petitioner did not submit any reply. Thereafter, the show cause notice in Form GST DRC-01 alleging wilful misstatement or suppression of facts was also not responded to. Consequently, the Proper Officer passed the order dated 07.11.2023 ex parte after recording that the petitioner had neither replied nor appeared.
The High Court found that the petitioner had taken contradictory stands. While alleging non-service of notices, it had also pleaded that it did not file a reply because it believed that the ITC had been reversed and tax liability had already been paid. The Court observed that the petitioner itself admitted that the notices and the order had been uploaded on the GST portal and further admitted becoming aware of them in 2024. Despite this, the writ petition was filed only in November 2025 without explaining the delay. The Court also noted that the petitioner had failed to avail the statutory remedy of appeal. Referring to decisions of the Supreme Court on delay, laches and exhaustion of statutory remedies, the High Court held that although no limitation is prescribed for invoking writ jurisdiction, it must be exercised within a reasonable period. Since the writ petition suffered from unexplained delay and laches, it was dismissed.
The petitioner thereafter approached the Supreme Court by way of a Special Leave Petition. The petitioner contended that the material facts necessary for invoking Section 74 of the CGST Act had not been disclosed, that there was no wilful suppression of material facts, that the ITC claimed in the October 2017 return had subsequently been voluntarily reversed in the November 2017 return, and that a similar issue was pending before the Supreme Court in another Special Leave Petition.
FULL TEXT OF THE SUPREME COURT JUDGMENT/ORDER
1. Delay condoned.
2. Learned counsel for the petitioner submits that the material facts disclosing necessary ingredients for invoking Section 74 of the Central Goods and Service Tax Act, 2017 (for short, ‘the CGST Act’) has not been disclosed. There is no willful suppression of material facts and the Input Tax Credit (ITC) claimed in the returns filed for October 2017 has been subsequently voluntarily reversed in the returns filed for November, 2017. It is also contended that similar issue is pending consideration before this Court in SLP (C) No. 33594 of 2025.
3. We have considered the show cause notice dated 08.09.2023 and the assessment order dated 07.11.2023 passed by the Officer concerned. It is patently clear from the order impugned that the factual matrix giving rise to the show cause notice has been elaborately discussed. It was open to the petitioner to assail the assessment order by way of an appeal under Section 107 of the CGST Act. He contends that he was unaware of the order which had been uploaded on the electronic portal. No convincing reason to overlook the electronic communication is offered. That apart, petitioner by his own admission was made aware of the proceedings much earlier in 2024 and thereafter approached the High Court belatedly in 2025. The High Court had rightly declined to entertain the Writ Petition as a surrogate to appellate proceedings which the petitioner had not availed and had become time barred. Present case stands on a different factual matter from SLP (C) No. 33594 of 2025 where the show cause notice under Section 74 of the CGST Act had been challenged on the ground primary facts disclosing suppression had not been stated. In view of these facts, we are not inclined to entertain the Special Leave Petition.
4. The Special Leave Petition is accordingly dismissed and the accompanying interlocutory application(s), if any, stands disposed of.
Author Bio
