Case Details: C.L. International vs. Additional Commissioner, Central Tax (Delhi West) (2026) 40 Centax 40 (S.C.)
Judiciary and Counsel Details
- K.V. Viswanathan & Vipul M. Pancholi, JJ.
- S/Shri Ajay Choudhary, AOR, Ramakant Gaur, Sneha Arya, Harshi Gaur, Meenakshi Sahu, Roopini Nandam & Sobiya Manzoor, Advs., for the Petitioner.
Facts of the Case
Allegations arose that ITC had been availed based on invoices issued by multiple supplier entities, which were found to be non-existent or non-functional, and in which no actual supply of goods had taken place. Acting on such allegations, search operations were conducted at the premises connected with the transactions, and a show-cause notice was issued proposing the denial of the ITC. The assessee submitted a reply to the notice disputing the allegations and contended that the transactions were genuine and supported by documentation. The adjudicating authority nevertheless passed an Order-in-Original holding that the supplier entities were bogus and consequently denied the entire ITC. The assessee challenged the action before the High Court on the ground that the reply to the notice had not been properly considered and that the order violated the principles of natural justice. The High Court declined to entertain the writ petition, observing that the controversy involved a complex factual examination of transactions, entities, and their interlinkages, and therefore, the appropriate course was to pursue the statutory appellate remedy, while granting liberty to file an appeal despite the expiry of the limitation period. The assesse filed an appeal against the High Court order. The matter was accordingly placed before the Hon’ble Supreme Court.
Supreme Court Held
The Hon’ble Supreme Court held that no ground existed to interfere with the order of the High Court declining to entertain the writ petition. The Court observed that the controversy involved examination of multiple transactions and interconnected entities, which required factual adjudication more appropriately undertaken in appellate proceedings. It was noted that the High Court had rightly directed the assessee to pursue the statutory remedy of appeal. The Court therefore extended the time for filing the appeal and directed that if the appeal was filed within the extended time, it should not be rejected on the ground of limitation and must be decided on the merits.
