Delhi High Court - Orders
Pulkit Goyal vs Commissioner Of Cgst & Anr on 25 July, 2025
Author: Prathiba M. Singh
Bench: Prathiba M. Singh
$~25
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ W.P.(C) 10748/2025 & CM APPL. 44416/2025
PULKIT GOYAL .....Petitioner
Through: Mr. Parvesh Bahuguna, Adv.
versus
COMMISSIONER OF CGST & ANR. .....Respondents
Through: Mr. Harpreet Singh, SSC, CBIC with
Mr. Jai Ahuja, Mr. Sanidhya Sharma
& Ms. Vanshika Kapoor, Advs.
CORAM:
JUSTICE PRATHIBA M. SINGH
JUSTICE SHAIL JAIN
ORDER
% 25.07.2025
1. This hearing has been done through hybrid mode.
CM APPL. 44415/20252. Allowed, subject to all just exceptions. The application is disposed of. W.P.(C) 10748/2025 & CM APPL. 44416/2025
3. The present petition has been filed by the Petitioner-Pulkit Goyal under Articles 226 and 227 of the Constitution of India, inter alia, assailing the Order-in-Original dated 30th January 2025 (hereinafter, 'impugned order') passed by the Additional Commissioner, Central Tax, Delhi West.
4. Vide the impugned order, substantial amounts of penalties have been imposed on the Petitioner. The impugned order reveals that there were several fictitious companies set up by the Petitioner along with one Mr. Shubham Khandelwal. Moreover, bank accounts were opened in fictitious names, telephone numbers and email addresses. One of such telephone number was of the Petitioner.
5. The case of the Petitioner is that he was merely an Office Boy of the W.P.(C) 10748/2025 Page 1 of 6 This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 29/07/2025 at 21:44:05 main person, Mr. Shubham Khandelwal and that he did not gain any benefit from the transactions in the present case. Ld. Counsel for the Petitioner relies upon the order dated 12th April 2022 in Bail Appln. 21/2022 titled 'Pulkit v. State (NCT of Delhi)' vide which bail was granted to the Petitioner.
6. The Court has considered the matter. Clearly, the Petitioner was one of the noticees in the Show Cause Notice (hereinafter, 'SCN') dated 22nd July, 2024. The Petitioner has filed a reply to the said SCN before the Adjudicating Authority but did not participate in the hearings. The reply filed by the Petitioner primarily argues that the Petitioner is only a scapegoat of Mr. Shubham Khandelwal and that the Petitioner has been falsely implicated in the present case. The said allegation is captured in the impugned order which is extracted below:-
"54. Sh. Pulkit Goyal with the assistance of Sh. Shubham Khandelwal and other persons created several fake entities using forged IDs. These entities were used exclusively to issue fake invoices without any actual supply of goods. The invoices were distributed by commission agents. They operated bank accounts associated with these fake entities, using straightforward signatures to facilitate ease of access. Transactions were primarily conducted through net banking. The commission earned from issuing these fake invoices, calculated at 0.7% of the invoice value, was shared equally between him and Sh. Shubham Khandelwal. He jointly owned a property at C-5, 217- 18, 1st floor, Sector-6, Rohini, Delhi, with Sh. Shubham Khandelwal, funded from the commissions earned through their fraudulent activities. He was aware of the illegal nature of their activities, including the creation and operation of fake entities and the issuance of invoices without goods. He confirmed that a Dell Laptop seized during a search operation contains records of W.P.(C) 10748/2025 Page 2 of 6 This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 29/07/2025 at 21:44:05 their fraudulent activities. His statement provides a detailed account of his involvement in a systematic fraud scheme involving fake invoicing, tax evasion through GST, creation of non-existent entities, and use of forged documents. These activities demonstrate a deliberate and coordinated effort to exploit regulatory loopholes for financial gain. He also retained the benefit of fraudulent transactions. Thus, Sh. Pulkit Goyal, actual controller of fake entities, key person and beneficiary rendered himself jointly and severally (with fake firms) liable for penal action under section 122 (1) & section 122 (1A) of CGST Act, 2017 and for each contravention under section 122 (3)(a) of the Act as he aided or abetted the offences specified in section 122(1) of the Act read with IGST Act, 2017 and concerned State GST Act, 2017."
7. Mr. Harpreet Singh, ld. SSC for the Respondent also submits that there is an alternate remedy available to the Petitioner.
8. This Court has already taken a view in W.P.(C) 5737/2025 titled 'Mukesh Kumar Garg vs. Union of India & Ors.' that where cases involving fraudulent availment of Input Tax Credit (hereinafter, 'ITC') are concerned, considering the burden on the exchequer and the nature of impact on the GST regime, ordinarily, writ jurisdiction ought not to be exercised in such cases. The relevant portions of the said judgment are set out below:-
"11. The Court has considered the matter under Article 226 of the Constitution of India, which is an exercise of extraordinary writ jurisdiction. The allegations against the Petitioner in the impugned order are extremely serious in nature. They reveal the complex maze of transactions, which are alleged to have been carried out between various non-existent firms for the sake of enabling fraudulent availment of the ITC.
12. The entire concept of Input Tax Credit, as W.P.(C) 10748/2025 Page 3 of 6 This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 29/07/2025 at 21:44:05 recognized under Section 16 of the CGST Act is for enabling businesses to get input tax on the goods and services which are manufactured/supplied by them in the chain of business transactions. The same 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.
13. It is observed by this Court in a large number of writ petitions that this facility under Section 16 of the CGST Act has been misused by various individuals, firms, entities and companies to avail of ITC even when the output tax is not deposited or when the entities or individuals who had to deposit the output tax are themselves found to be not existent. Such misuse, if permitted to continue, would create an enormous dent in the GST regime itself.
14. As is seen in the present case, the Petitioner and his other family members are alleged to have incorporated or floated various firms and businesses only for the purposes of availing ITC without there being any supply of goods or services. The impugned order in question dated 30th January, 2025, which is under challenge, is a detailed order which consists of various facts as per the Department, which resulted in the imposition of demands and penalties. The demands and penalties have been imposed on a large number of firms and individuals, who were connected in the entire maze and not just the Petitioner.
15. The impugned order is an appealable order under Section 107 of the CGST Act. One of the co-noticees, who is also the son of the Petitioner i.e. Mr. Anuj Garg, has already appealed before the Appellate Authority.
16. Insofar as exercise of writ jurisdiction itself is W.P.(C) 10748/2025 Page 4 of 6 This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 29/07/2025 at 21:44:05 concerned, it is the settled position that this jurisdiction ought not be exercised by the Court to support the unscrupulous litigants.
17. Moreover, when such transactions are entered into, a factual analysis would be required to be undertaken and the same cannot be decided in writ jurisdiction. The Court, in exercise of its writ jurisdiction, cannot adjudicate upon or ascertain the factual aspects pertaining to what was the role played by the Petitioner, whether the penalty imposed is justified or not, whether the same requires to be reduced proportionately in terms of the invoices raised by the Petitioner under his firm or whether penalty is liable to be imposed under Section 122(1) and Section 122(3) of the CGST Act.
18. The persons, who are involved in such transactions, cannot be allowed to try different remedies before different forums, inasmuch as the same would also result in multiplicity of litigation and could also lead to contradictory findings of different Forums, Tribunals and Courts."
9. The impugned order passed by the Adjudicating Authority would be appealable before the Appellate Authority in terms of Section 107 of the Central Goods and Service Tax Act, 2017 (hereinafter, 'CGST Act'). The present case involves analysis of facts, documents, etc. which is beyond the scope of writ jurisdiction. Moreover, the considerations for grant of bail and for cases such as the present one are completely different. The mere grant of bail would not in any manner mean that the Petitioner has been absolved of all the allegations made against him for enabling and engaging in fraudulent availment of ITC. This is not a case which is governed by any of the principles for entertaining of a writ petition as per the decision in Civil Appeal No. 5121/2021 dated 3rd September, 2021 titled 'The Assistant Commissioner of W.P.(C) 10748/2025 Page 5 of 6 This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 29/07/2025 at 21:44:05 State Tax & Ors. v. M/s Commercial Steel Limited', as laid down by the Supreme Court. Relevant portion of the said decision reads as under:
"11. The respondent had a statutory remedy under section 107. Instead of availing of the remedy, the respondent instituted a petition under Article 226. The existence of an alternate remedy is not an absolute bar to the maintainability of a writ petition under Article 226 of the Constitution. But a writ petition can be entertained in exceptional circumstances where there is:
(i) a breach of fundamental rights;
(ii) a violation of the principles of natural justice;
(iii) an excess of jurisdiction; or
(iv) a challenge to the vires of the statute or delegated legislation."
10. Under such circumstances, this Court is not inclined to entertain the present petition. However, considering that the substantive remedy which is available to the Petitioner by way of an appellate remedy, the Petitioner is permitted to file an appeal by 31st August 2025 before the Appellate Authority under Section 107 of the CGST Act.
11. If the same is filed within the time so granted, the appeal shall not be dismissed on the ground of being barred by limitation and shall be adjudicated on merits.
12. The petition along with the application, is disposed of in the aforesaid terms.
PRATHIBA M. SINGH, J.
SHAIL JAIN, J.
JULY 25, 2025 kk/ck W.P.(C) 10748/2025 Page 6 of 6 This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 29/07/2025 at 21:44:05