Shree Hanumant Steel Traders & Anr. v. Assistant Commissioner, Circle-5, Division-1,
Background
The petitioners challenged the respective notices issued by the respondent authority under Section 74(9) of the GST Act, 2017, dated 16.10.2025. The notices related to allegations that input tax credit had been availed by issuing fake invoices without actual supply of goods. The petitioners contended that the notices did not contain the foundational facts necessary to support the allegations of fraud, wilful misrepresentation or suppression.
The respondent authority opposed the petitions, submitting that the notices had appropriately set out the foundational facts and that the petitioners had an efficacious alternative remedy of filing appeals under Section 107 of the GST Act.
Court Observation
The Court, on careful perusal of the impugned notices, found that the authority failed to assign sufficient reasons while issuing the notices under Section 74(9).
Relying upon the Supreme Court's decision in Tata Steels Ltd. v. Union of India, the Court observed that where an extended limitation period is invoked on allegations of fraud, wilful misrepresentation or suppression, the foundational facts leading to such inference must be evident from the notice itself. Mere use or mechanical recitation of these expressions does not demonstrate application of mind or justify recovery beyond the normal limitation period.
Final Verdict
The High Court held that the impugned notices issued under Section 74(9) dated 16.10.2025 were unsustainable and accordingly quashed the respective notices. The writ petitions were therefore allowed.
The Court, however, granted liberty to the respondent authority to issue fresh notices strictly in accordance with law, if so advised.
Case Referred by Court
Tata Steels Ltd. v. Union of India — Supreme Court of India — 2026
Other Case Law
COMMISSIONER, CGST & CENTRAL EXCISE v. GODREJ TYSON FOODS LIMITED
Whether printing the manufacturer's name and address on packaging constitutes use of a “brand name” for exemption under Notification No. 02/2017-CT(Rate). Whether institutional supplies qualify as “pre-packaged and labelled” goods under Notificati
BACKGROUNDThe taxpayer supplied frozen poultry products to institutional consume...
Read MoreC.H. Robinson Worldwide Freight India Private Limited vs Additional Commissioner, CGST Delhi South & Ors.
Whether a Show Cause Notice issued under Section 73 of the CGST Act, 2017 is barred by limitation where it was not served upon the assessee at least three months prior to the outer time limit prescribed under Section 73(10) of the CGST Act — and whether
BACKGROUNDThe CGST Department (Delhi-South) conducted a scrutiny of the returns ...
Read MoreShamhu Saran Agarwal and Company v. Additional Commissioner Grade-2 & Ors.
Legality of detention and penalty under Section 129 GST on ground of undervaluation of goods
Facts :The petitioner challenged a penalty order dated 20.12.2020 and appellate ...
Read More