Delhi HC Sends GST ITC Fraud Dispute to Statutory Appeal, Rejects Jurisdiction Objections

The proprietor of M/s Bharat Facilities approached the High Court challenging an order passed by the Joint Commissioner, CGST, alleging fraudulent availment of input tax credit through fake invoices. The proceedings arose from a large DGGI investigation into an alleged racket involving multiple fake firms issuing invoices without actual supply, in which the petitioner was named as one of the beneficiaries.

The petitioner questioned the jurisdiction of the authorities, arguing that the show cause notice could not have been issued at the level of the Superintendent, given the quantum involved, and that there was uncertainty regarding the correct appellate forum due to the multi-jurisdictional nature of the investigation.

Issue Raised: Whether the adjudication order could be set aside on the ground of lack of jurisdiction or ambiguity regarding the appellate forum.

HC Held: The Hon’ble High Court refused to interfere. It held that in large, multi-noticee DGGI investigations, adjudication by a common adjudicating authority based on monetary thresholds is legally valid. The Court also noted that the impugned order itself clearly specified the appellate authority as the Commissioner (Appeals), Gurugram, leaving no real ambiguity.

The Court relegated the petitioner to the statutory appellate remedy. Liberty was granted to file an appeal within the prescribed time with the required pre-deposit, with protection against limitation if filed within the stipulated period.

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