Delhi High Court
Laxmi Hari Collection – Through Its … vs The Additional Commissioner Delhi – … on 29 July, 2025
Author: Prathiba M. Singh
Bench: Prathiba M. Singh
$~70
* IN THE HIGH COURT OF DELHI AT NEW DELHI
Date of decision: 29th July, 2025
+ W.P.(C) 11092/2025& CM APPL. 45640/2025
LAXMI HARI COLLECTION - THROUGH ITS PROPRIETOR
SH. MAHESH KUMAR SHARMA .....Petitioner
Through: Dr. Sudhir Sangal, Adv.
versus
THE ADDITIONAL COMMISSIONER DELHI - WEST,
CENTRAL GOODS AND SERVICES TAX
DEPARTMENT & ANR. .....Respondents
Through: Ms. Monica Benjamin, SSC with Ms.
Nancy Jain, Adv.
Ms. Vaishali Gupta, Advs.
CORAM:
JUSTICE PRATHIBA M. SINGH
JUSTICE SHAIL JAIN
Prathiba M. Singh, J. (Oral)
1. This hearing has been done through hybrid mode.
2. The present petition has been filed on behalf of the Petitioner – Laxmi
Hari Collection under Article 226 of the Constitution of India, inter alia,
assailing the Order-in-Original dated 30th January, 2025 (hereinafter, the
‘impugned order’) passed by the Office of the Commissioner, Central Tax
(Delhi West).
3. Vide the impugned order, penalty has been imposed on the Petitioner
in the following terms:
“36. I impose penalty of Rs.1,45,38,901 (IGST
Rs.8,53,307/- + CGST Rs.68,42,797/- + SGST
Rs.68,42,797/-) (Rupees one Crore Forty Five Lakh
Thirty Eight Thousand Nine Hundred & One only), onW.P.(C) 11092/2025 Page 1 of 8
Signature Not Verified
Digitally Signed
By:DEVANSHU JOSHI
Signing Date:04.08.2025
12:35:06
M/s Laxmi Hari Collection, in terms of Section
122(1)(ii) of the CGST Act, 2017, read with similar
provisions of the Delhi GST Act, 2017 and or under
Section 20 of the IGST Act, 2017, as they passed the said
credit fraudulently.
36.1 I impose penalty of Rs.1,48,34,886/- (IGST
Rs.8,53,562/- + CGST Rs.71,42,162/- + SGST
Rs.68,39,162/-) (Rupees One Crore Forty Eight Lakh
Thirty Four Thousand Eight Hundred & Eighty Six
only), M/s Laxmi Hari Collection
(07BDGPS9274J2ZS), in terms of Section l22(1)(vii) of
the CGST Act, 2017, read with similar provisions of the
Delhi GST Act, 2017, and/or under Section 20 of the
IGST Act, 2017, as they availed the said credit
fraudulently;”
36.2 I refrain from imposing penalty on M/s Laxmi Hari
Collection (07BDGPS9274J2ZS), under Section
122(1)(x), (xii), (xvi) and (xvii) of the CGST Act, 2017,
read with similar provisions of the Delhi GST Act, 2017,
and/or under Section 20 of the IGST Act, 20 17;”
4. It is stated that upon migration of the Petitioner’s business from the
Value Added Tax regime into the Goods and Services Tax (‘GST’) regime,
the Petitioner was allotted two GST numbers, which are set out below:
07BDGPS9274J1ZT
07BDGPS9274J2ZS
It is the case of the Petitioner that the registration being GSTIN
07BDGPS9274J2ZS has never been utilized by the Petitioner and on the said
account, a demand was received by the Petitioner on 20th September 2019 vide
a notice issued by the Department of Trade and Taxes, Delhi. Further, in
paragraph 15 of the writ petition, it is stated that the second GST registration,W.P.(C) 11092/2025 Page 2 of 8
Signature Not Verified
Digitally Signed
By:DEVANSHU JOSHI
Signing Date:04.08.2025
12:35:06
being GSTIN: 07BDGPS9274J2ZS, was misused by some individual who
may have committed a fraud which becomes evident from the fact that
unknown to the Defendant, after logging into this account, a different email
and phone number has been used. Thus, the claim of the Petitioner is that he
did not apply for the second GST registration. Thereafter, the Petitioner is
stated to have filed an FIR, in P.S. Kotwali, Chandni Chowk on 30th
September 2019. This was followed up by a communication on 1st October,
2019 to the GST Department to block the said GSTIN number.
5. On 3rd March, 2023 two summons under Section 70 of the CGST Act,
2017 were received by the Petitioner with regard to investigation of sales
made to one entity being, M/s YS Enterprises by Laxmi Hari using GSTIN
07BDGPS9274J2ZS. The Petitioner herein, then participated in the
proceedings including in the investigation and filed a reply on 21st March,
2023. However, a demand cum Show Cause Notice was issued on 30th April
2023 in the following terms:
“23.5 Now, therefore, M/s Laxmi Hari Collection
(07BDGPS9274J2ZS), 1967, Second Floor, Chandini
Chowk, Opp. Bank of India, Delhi – 110006 (through its
Proprietor), are required to Show Cause to the
Joint/Additional Commissioner, Central GST
Commissionerate, Office of Principal Commissioner,
Delhi North Commissionerate, CR Building, IP Estate,
New Delhi -110002, as to why:
i. Penalty amounting to Rs.1,45,38,901 (IGST Rs.
8,53,307/- + CGST Rs.68,42,797/- + SGST Rs.
68,42,797/-) (Rupees One Crore Forty Five
Thousand Thirty Eight Thousand Nine Hundred &
One only), should not be imposed upon them in
terms of Section 122(1)(ii) of the CGST Act, 2017,
read with similar provisions of the Delhi GST Act,
2017, and/or under Section 20 of the IGST Act,W.P.(C) 11092/2025 Page 3 of 8
Signature Not Verified
Digitally Signed
By:DEVANSHU JOSHI
Signing Date:04.08.2025
12:35:06
2017, as detailed in Para 16.10;
ii. Penalty amounting to Rs.1,45,31,886/- [IGST
Rs.8,53,562/- + CGST Rs.71,42,162/- + SGST
Rs.68,39,162/-) (Rupees One Crore Forty Five
Lakh Thirty One Thousand Eight Hundred &
Eighty Six only), should not be imposed upon them
in terms of Section 122(1)(vii) of the CGST Act,
2017, read with similar provisions of the Delhi
GST Act, 2017, as detailed in Para 16.10;
iii. Penalty in terms of Section 122(1)(x), (xii),
(xvi) and (xvii) of the CGST Act, 2017, read with
similar provisions of the Delhi GST Act, 2017,
and/or under Section 20 of the IGST Act, 2017,
should not imposed upon them on the amount
mentioned in sl.no. (i) & (ii) above.”
6. Further, on 24th January, 2025 a notice of personal hearing dated 8th
January, 2025 was given to the Petitioner and the Petitioner attended the said
hearing. However, the impugned Order-in-Original dated 30th January, 2025
was passed.
7. The submissions by Mr. Sangal is that the second GSTIN number,
being, GSTIN 07BDGPS9274J2ZS has never been utilized by the Petitioner
and upon receiving the intimation of the first demand notice, steps were taken
by the Petitioner, such as, lodging an FIR, as also the cancellation of the said
GSTIN Number. It is his further submission that the Petitioner is an illiterate
person and does not have proper understanding of the manner in which the
GSTIN system functions. His account was being managed by an accountant.
8. It is further argued by the ld. Counsel that, since the FIR has already
been registered and in the impugned Order-in-Original, the authority itself
acknowledges the fact that Mr. Mahesh Kumar Sharma, the proprietor of the
Petitioner, did not have any knowledge of the second firm, the petition qua
W.P.(C) 11092/2025 Page 4 of 8
Signature Not Verified
Digitally Signed
By:DEVANSHU JOSHI
Signing Date:04.08.2025
12:35:06
the demand against the Petitioner deserves to be quashed.
9. Ms. Benjamin, on the other hand, submits that the e-mails received at
the time when the GSTIN numbers were allotted to the Petitioner, dated 5th
July, 2017, and 6th July, 2017 would in fact show that both the e-mails have
been received on the registered number/e-mail address of the Petitioner itself.
Thus, the Petitioner was well aware of the fact that two GST numbers have
been generated.
10. In response, Mr. Sangal, ld. Counsel for the Petitioner points out that
the Aadhaar authentication has been done with respect to the e-mail ID, being
[email protected] with a different mobile number than that of the
Petitioner.
11. Heard. Obviously, there is a possibility that the Petitioner’s identity has
been used by someone who was closely aware of the Petitioner’s e-mail
address, mobile number, etc. The record does not reveal any FIR having been
registered. However, it is noticed that there is a complaint by the Petitioner to
the police dated 30th September, 2019, which has been placed on record. In
the said complaint, the Petitioner himself has admitted to have mistakenly
applied for two GST registrations. For ease of reference, the said letter is
extracted below:
W.P.(C) 11092/2025 Page 5 of 8
Signature Not Verified
Digitally Signed
By:DEVANSHU JOSHI
Signing Date:04.08.2025
12:35:06
On the other hand, it is also noticed that there is no name given in the Aadhar
Authentication at page 193, which reads as under:
12. A bare perusal of the above images shows some contradictions in the
Petitioner’s case. To elaborate, on one hand, it is the case of the Petitioner that
W.P.(C) 11092/2025 Page 6 of 8
Signature Not Verified
Digitally Signed
By:DEVANSHU JOSHI
Signing Date:04.08.2025
12:35:06
though it had applied for two GST registrations, it has been using only one of
them and the other Registration, being GSTIN: 07BDGPS9274J2ZS, has
been misused by some unknown entity. Whereas, on the other hand by
alleging the Aadhaar authentication to have been made from a different
mobile number, the Petitioner tries to dispute the fact that it had filed for the
second application.
13. The Court also notices, with some concern, that after the initial
complaint was filed in 2019, no follow-up has been initiated by the Petitioner
into the investigation in the said matter. This shows that Petitioner was not
seriously pursuing its complaint and had therefore filed it only half-heartedly.
Hence, it cannot assail the second GST registration, at this stage, under writ
jurisdiction as it may need a factual inquiry. Further, the limitation for
challenging the Order-in-Original has also expired in terms of Section 107 of
the CGST Act, 2017.
14. In the overall circumstances, in the opinion of this Court, the Petitioner
has been quite casual in not challenging the impugned Order-in-Original in
time and has not taken any steps to ensure as to whether the allegations of
fake GST and generation are correct or that the actual culprits are brought to
light. The responsibility lies upon the Petitioner to ensure that his identity is
not misused by anyone.
15. Under these circumstances, this Court is of the opinion that the
impugned order does not warrant interference of this Court under writ
jurisdiction. Accordingly, the Petitioner is free to avail its remedies u/s 107 of
the CGST Act, 2017 by filing an appeal on or before 31st August 2025, along
with the requisite pre-deposit.
16. In view thereof, the present writ petition is dismissed, relegating the
W.P.(C) 11092/2025 Page 7 of 8
Signature Not Verified
Digitally Signed
By:DEVANSHU JOSHI
Signing Date:04.08.2025
12:35:06
Petitioner to the Appellate Remedy. Pending applications, if any, are also
disposed of in the above terms.
PRATHIBA M. SINGH
JUDGE
SHAIL JAIN
JUDGE
JULY 29, 2025/pd/rks/Ar.
W.P.(C) 11092/2025 Page 8 of 8
Signature Not Verified
Digitally Signed
By:DEVANSHU JOSHI
Signing Date:04.08.2025
12:35:06