Delay and Laches Defeat ITC Claim: HC Refuses Relief Despite Supplier Certificates

The petitioner, a GST-registered assessee, faced proceedings for Assessment Year 2017–18 after discrepancies were noticed between GSTR-3B and GSTR-2A, indicating excess Input Tax Credit (ITC). A notice in Form GST ASMT-10 was issued in June 2020, followed by a show cause notice in September 2021. However, the petitioner failed to submit proper replies or supporting documents during the proceedings. Thereafter, an order under Section 73(9) of the CGST Act was passed in November 2022 demanding Rs. 2.89 lakh.

The petitioner obtained certificates from suppliers in August 2023 confirming that tax had been paid on the transactions. Relying on these certificates, the petitioner approached the High Court in 2026 seeking quashing of the demand order and an opportunity to have the certificates considered.

Issue Before Court: Whether relief can be granted to an assessee who failed to respond to statutory notices and approached the Court after significant delay, relying on subsequently obtained supplier certificates.

HC’s Order: The High Court dismissed the writ petition, holding that the petitioner was guilty of gross delay and negligence in pursuing available remedies. The Court noted that despite multiple opportunities, no proper replies or supporting documents were furnished during adjudication.

Further, even after obtaining supplier certificates in August 2023, the petitioner waited over 2½ years to approach the Court. Such inaction was fatal. The Court emphasised that writ jurisdiction under Article 226 cannot be invoked in cases where the petitioner has been careless and allowed proceedings to attain finality.

The Court also distinguished earlier judgments relied upon by the petitioner, observing that those cases did not involve such prolonged delay and inaction. Thus, no interference was warranted.

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