Order Date - 07 July 2025

Parties: Bhupender Kumar Vs Additional Commissioner Adjudication, CGST Delhi North & Ors.

Facts -

• The Petitioner, Bhupender Kumar, a GST consultant, was penalized for Rs. 285+ crores under Section 122(1A) and other sections of the CGST Act, accused of aiding in creation of 54 fake firms used to fraudulently avail and pass on Input Tax Credit (ITC).
• He admitted, in statements, that he created fake firms at the behest of one Sanjay Sehgal and received documents and commission for GST registrations.
• He did not reply to the show cause notice (SCN) or participate in the adjudication process.

Issue -

• Whether the penalty under Section 122(1A) can be sustained in the absence of a specific notice under the provision, especially when the petitioner claimed no personal financial gain?

Order -

• The division bench of the Hon’ble High court observed that the statements would show that the Petitioner was all along aware that he was supporting Mr. Sanjay Sehgal in creating fake firms. The exact role which he may have played during this process is a factual analysis which this Court cannot undertake in a writ petition.
• The Petitioner was thus fully aware and enabled the creation of these fake firms and was aware that ITC was being fraudulently availed of. The Petitioner, being a GST consultant who was also earlier working with the Delhi GST Department has clearly made use of his knowledge and assisted Mr. Sehgal in setting up these fake firms.
• The manner in which fraudulent ITC has been availed would also show that it was a continuous process and not a one time act of the parties involved. Under such circumstances Section 122(1A) of the CGST Act was clearly applicable.
• Under these circumstances, this Court is not inclined to entertain the present writ petition. However, since the impugned order is of 21st January, 2025, this Court is of the view that though limitation period has expired, he can be given an opportunity to avail of his appellate remedy in accordance with law under Section 107 of the CGST Act, 2017.