GST Fraud Writ Delayed Due to Unremoved Defects for 3 Months: Delhi HC Grants One-Time Liberty to File Statutory Appeal Beyond Limitation [Read Order]

Meta: GST Fraud Writ Delayed Due to Unremoved Defects for 3 Months: Delhi HC Grants One-Time Liberty

In a recent ruling, the Delhi High Court declined to entertain a writ petition filed in a GST fraud matter but granted the petitioner a one-time opportunity to file a statutory appeal despite the expiry of the limitation period.

Navneet Bansal, the petitioner, filed a writ petition challenging the Order-in-Original dated 28 November 2024 passed by the Additional Commissioner, CGST Delhi North, by which a penalty of ₹1.63 crore was imposed on him under Rule 26 of the Central Excise Rules, 2002 read with Section 174 of the CGSTAct, 2017.

The proceedings arose from an investigation conducted by the Directorate General of GST Intelligence (DGGI), Delhi Zonal Unit, into the alleged issuance of invoices without actual supply of goods for fraudulent availment of CENVAT credit. During the investigation, the petitioner’s statement was recorded on 6 January 2021, in which he admitted to issuing invoices without supply of goods and receiving commission for the same. The statement was never retracted.

A show cause notice dated 7 May 2021 was issued to the petitioner. While the petitioner sought copies of the relied upon documents, he did not file any reply on merits to the notice and did not effectively participate in the adjudication proceedings. This culminated in the passing of the impugned order imposing penalty.

Before the High Court, the petitioner's counsel argued that the relied upon documents were not supplied to him and that the impugned order suffered from procedural infirmities. They also submitted that the writ petition had been filed on 31 January 2025.

The Division Bench comprising Justice Prathiba M. Singh and Justice Renu Bhatnagar observed that the impugned order was appealable under Section107 of the CGST Act and that the petitioner had an effective statutory remedy available. The court explained that in cases involving fraudulent availment of input tax credit or CENVAT credit, writ jurisdiction is ordinarily not exercised, as such matters involve disputed questions of fact requiring detailed examination.

The court further observed that although the impugned order was passed in November 2024, the writ petition came up for listing only in April 2025. The petitioner explained that the delay occurred because the matter may have remained under registry objections as defects were not removed for about three months.

Taking this explanation into account, the court gave the petitioner the benefit of doubt. The court pointed out that it was possible the delay was procedural and not deliberate. On this basis, the court granted the petitioner a one-time liberty to file a statutory appeal challenging the impugned order.

The court directed that if the appeal is filed in accordance with law on or before 31 January 2026, it shall not be dismissed on the ground of limitation and shall be decided on merits by the appellate authority. The court also clarified that its observations would not bind the appellate authority during adjudication.

Accordingly, the writ petition was dismissed, with liberty granted to the petitioner to pursue the statutory appellate remedy.

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