In the case of Mukesh Kumar Garg
In yet another writ petition pertaining to fraudulent availment of Input Tax Credit (ITC) to the tune of more than Rs. 115 crores, Delhi HC rules on misuse of ITC facility which “if permitted to continue, would create an enormous dent in the GST regime itself”; On nature of fraud, HC noticing serious allegations and ‘complex maze of transactions’ carried out between various non-existent firms for the sake of fraudulent transactions, harps on how a large number of writ petitions have been filed on availment of fake ITC without supply of goods; Further holds that “Input Tax Credit… is meant as an incentive for businesses who need not pay taxes on the inputs, which have already been taxed at the source itself. The said facility, which was introduced under Section 16 of the CGST Act is a major feature of the GST regime, which is business friendly and is meant to enable ease of doing business.”; Petitioner and another were alleged to have established 28 firms in collusion with various other traders for availing fake Input Tax Credit with any supply of goods; Order was passed by Additional Commissioner-Adjudication, CGST against several firms as also penalty was imposed; As for maintainability of writ petition, HC brings to light the fact that order is a ‘detailed’ one and ‘appealable’ u/s 107 while opining that “when such transactions are entered into, a factual analysis would be required to be undertaken and the same cannot be decided in writ jurisdiction”; Discussing ‘unscrupulous litigants’ HC also highlights that persons involved in fraudulent transactions cannot be allowed to “try different remedies before different forums” dismisses writ petition with costs amounting to Rs. 50,000 to be deposited with the Delhi High Court Bar Association