Non-existent Entity and Non-Payment of due amount as per Invoices within 180 days is Articulated: Delhi HC directs Re adjudication [Read Order]

The Delhi High Court directs re-adjudication for a non-existent entity and non-payment of the due amount as per invoices within 180 days is articulated. Omkara Footwear, the petitioner had preferred three applications seeking a refund of an aggregate amount of ₹18,00,202/-(₹7,74,776/- in respect of Central Goods and Services Tax Act, 2017 and ₹10,55,426/- in respect of State Goods and Services Tax Act, 2017) for the period January 2020 to March 2020. The Adjudicating Authority had noticed that the petitioner had availed of input tax credit in respect of one or more entities that were “non-existent/high risk”.

The petitioner was called upon to submit the certified copy of all input/invoices and bank statements showing the payment details against each invoice within a period of 15 days from the date of the show-cause notices. The petitioner’s claim for a refund was rejected because one of the suppliers, that is, M/s. Yamuna Overseas from whom the petitioner had received supplies was found to be non-existent at its registered place of business, and the documents submitted by the petitioner failed to establish that the petitioner had paid for the goods and services within a period of 180 days from the date of the invoices.

The petitioner has produced a screenshot from the website indicating that the GST registration of M/s. Yamuna Overseas is still active and extant. In addition, the petitioner had also produced the invoices, along with the e-waybills mentioning the registration number of the vehicles in which the goods received from the said supplier, were transported.

The Division bench comprising of Justice Vibhu Bakhru and Justice Amit Mahajan set aside the impugned order rejecting the applications filed by the petitioner for refund pertaining to the period January 2020 to March 2020 and remand the matter to the Adjudicating Authority to consider afresh. Since the allegation that M/s Yamuna Overseas is non-existent and that the petitioner had not paid the amount due as per the invoices within the period of one hundred and eighty days is articulated in the impugned order, it would not be necessary for the Adjudicating Authority to issue a fresh show cause notice. The court has given liberty to the petitioner to respond to the said allegations and provide all relevant material as the petitioner considers necessary.

He shall also furnish a reconciliation statement showing the date of invoices and the dates on which the payments have been made. The same may be filed before the Adjudicating Authority within a period of four weeks from the date. Thus, the petition was disposed of.

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