The Delhi High Court addressed a case involving Braham Prakash who challenged an adjudication order dated January 21, 2025, which raised demands based on allegations of fraudulent input tax credit (ITC) availment. The allegations stemmed from an investigation by DGGI, Rohtak into a network of fake firms. The petitioner claimed that the show cause notice was uploaded late on the GST portal and that no personal hearing was granted before the order was passed. The department alleged that the petitioner was part of a group availing ITC from firms created solely for generating fake invoices without actual movement of goods.
The issue was whether the High Court should use its writ jurisdiction to interfere with the adjudication order, given the availability of a statutory appeal under Section 107 of the CGST Act. The Court decided that allegations of fraudulent ITC require a detailed examination of facts and evidence, unsuitable for writ jurisdiction. It emphasized that serious tax fraud allegations are appealable under Section 107 and do not justify writ interference except in exceptional cases.
The Court noted that issues such as the lack of a personal hearing and delayed notice uploading can be addressed by the appellate authority. Consequently, the writ petition was dismissed, allowing the petitioner to file an appeal with the prescribed pre-deposit. The appellate authority was instructed not to dismiss the appeal on limitation grounds if filed by January 15, 2026, and to decide it on its merits.
Parties: Braham Prakash. v. Additional Commissioner & ors
Order Date: 09 December 2025
Facts –
- The petitioner challenged an adjudication order dated 21.01.2025 raising demand on allegations of fraudulent availment of input tax credit based on investigation conducted by DGGI, Rohtak into a network of fake firms.
- The petitioner contended that the show cause notice dated 23.07.2024 was uploaded belatedly on the GST portal and that no personal hearing was granted prior to passing of the order.
- The department alleged that the petitioner was one among several entities which had availed ITC from firms created solely for generating fake invoices without actual movement of goods. The petitioner invoked writ jurisdiction alleging violation of principles of natural justice and limitation.
Issue –
- Whether the High Court should exercise writ jurisdiction to interfere with an adjudication order involving allegations of fraudulent availment of ITC despite availability of a statutory appeal under Section 107 of the CGST Act?
Order –
- The Court held that cases involving allegations of fraudulent availment of ITC require detailed factual examination and consideration of voluminous evidence, which cannot be undertaken in writ jurisdiction.
- It reiterated that an adjudication order raising serious allegations of tax fraud is appealable under Section 107 and does not warrant writ interference except in exceptional circumstances.
- The Court observed that issues relating to lack of personal hearing and delayed uploading of the show cause notice can be appropriately examined by the appellate authority.
- Accordingly, the writ petition was disposed of with liberty to the petitioner to file an appeal along with the prescribed pre-deposit. The appellate authority was directed not to dismiss the appeal on limitation if filed by 15 January 2026 and to decide it on merits.
