DGGI
7 articles
Death Is Not a Bar: Delhi High Court Holds Section 93 CGST Act Permits GST Penalty Proceedings to Be Commenced Against a Legal Representative After the Taxpayer's Death
More than three years after her husband died, the GST Department issued his widow a Show Cause Notice proposing a penalty for his alleged acts. She argued Section 93 of the CGST Act only lets proceedings already begun in a taxpayer's lifetime continue after death — not begin afresh. The Delhi High Court disagreed, upheld the provision against an Article 14 challenge, and ordered the Department to explain what it is still doing with ₹15.4 lakh in seized cash.
13 min readDifferent Statute, Different Subject Matter: Delhi High Court Refuses to Let a Concluded DGGI Fraud Probe Shield a Separate Section 73 Demand
A script-services company facing a ₹10.57 crore input tax credit demand argued that a state GST officer's proceedings were barred because the Directorate General of GST Intelligence had already investigated it — and that investigation had since concluded. The Delhi High Court disagreed on every ground: the statutory appeal was never filed, the writ came two years late, and the two notices, issued under different sections for different reasons, were never the same subject matter to begin with.
13 min readStatement First, Cross-Examination Second: CESTAT Allahabad Invokes Section 9D of the Central Excise Act to Quash a ₹2.39 Crore Cenvat Credit Fraud Demand Against Rathi Steel and Power
A Ghaziabad steel manufacturer was one of 68 noticees accused of availing Cenvat credit on cenvatable invoices issued without any actual supply of copper scrap. The Customs, Excise & Service Tax Appellate Tribunal set aside the ₹2.39 crore demand confirmed against it, holding that the adjudicating authority relied on third-party statements without following Section 9D of the Central Excise Act's mandatory procedure for admitting them in evidence, treated a co-noticee's settlement under an amnesty scheme as proof against unrelated parties, and confirmed the demand through generic findings that never engaged the appellant's own case.
14 min readRepresenting the Client or Running the Business: Delhi High Court Upholds GST Search of a Tax Advocate's Office Over an Advocate-Client Privilege Challenge
GST intelligence officers searched the office of a practising tax advocate and seized his firm's CPU after alleging he was not merely representing a gaming company under investigation but was himself a beneficiary of an offshore gambling operation generating an alleged ₹365.68 crore GST liability. The Delhi High Court dismissed the advocate's challenge to the search, holding that Section 67(2) of the CGST Act was validly invoked, that advocate-client privilege protects client communications rather than an advocate's own conduct, and that safeguards over third-party client data — not invalidation of the search — were the appropriate remedy.
14 min readSame Assessee, Same Period, Different Subject Matter: Delhi High Court Applies Armour Security's Two-Fold Test to Uphold Parallel DGGI Proceedings Over State ITC Action
An exporter facing a combined demand of over seven crore rupees from the Directorate General of GST Intelligence argued that the State GST department's earlier, separate proceedings on the same input tax credit and period barred the DGGI's case under Section 6(2)(b) of the CGST Act. The Delhi High Court disagreed, applying the Supreme Court's Armour Security two-fold test to hold that a general ineligible-ITC assessment and a fraud investigation into fictitious suppliers are not the 'same subject matter' merely because both concern ITC claimed in overlapping years, and relegated the challenge, along with an objection to a multi-year consolidated notice, to the statutory appeal.
13 min readState Registration Is No Shield: Delhi High Court Applies Armour Security to Uphold DGGI's Cross-Empowerment in a Multi-State Works-Contract ITC Chain
A works-contract subcontractor holding three separate GST registrations faced a combined demand of over five and a half crore rupees across three states, arising from an alleged fake-invoicing chain traced through its sub-subcontractor. The Delhi High Court rejected its challenge to DGGI's jurisdiction over State-registered taxpayers and to the Delhi North Commissionerate's authority to adjudicate, relegating the reasons-adequacy and Circular 171 defences to the Section 107 appeal, while extending interim protection to file it.
13 min readCircular, Not Notification: Delhi High Court Upholds the 'Highest Demand' Rule for Choosing a Common Adjudicating Authority in Multi-State DGGI Notices
Eight petitioners caught up in an alleged three-layer fake-invoicing chain challenged the jurisdiction of the Delhi-based officer who adjudicated a composite show cause notice naming 146 noticees, arguing that only a notification, not a circular, could assign an adjudicating authority. The Delhi High Court dismissed the petitions, holding that the 'highest demand' circular does no more than allocate business among officers already vested with pan-India jurisdiction by notification, and relegated the petitioners to their statutory appeal.
13 min read