In a writ, jurisdiction relief may be denied to a petitioner on the ground that he has not approached the Court with clean hands, even when he satisfies all the ingredients of a statutory provision. A divisional Judge bench comprising Hon’ble Justice Manmohan and Navin Chawla, in the matter of M/S. Ajanta Industries Vs. Commissioner of Central Goods and Services Tax & Anr. (W.P.(C) 6609/2021), dealt with an issue where the petitioner filed a writ petition challenging the rejection order dated 04th April 2021, passed by respondent no.2 in RFD-06. Petitioner seeks a refund of Rs.2,05,05,890/- for the period of April 2020-May 2020 along with interest thereon in accordance with the law.
The counsel for the petitioner submitted that the petitioner could not discharge his GST liability in the third half of the year 2020-21 due to financial constraints. The counsel also submitted that the petitioner had duly filed all its returns up to April and May 2020 and hence was entitled to refund within sixty days from the date of filing Form GST-RFD-01 in accordance with Section 54(7) of the Central Goods and Services Tax Act, 2017. Further, the counsel pointed out that as per Rule 90 of Central Goods and Services Tax Rules, it is mandatory to issue the acknowledgment in RFD-02 within fifteen days and if not done, all further proceedings would be without jurisdiction. Lastly, he contended that the petitioner to get the refund as her prayed for, due to a lapse of time.
Later a perusal of the impugned order revealed that very serious findings of fake Input Tax Credit were been given by respondent no. 2 in the impugned order. The court stated- “It is settled law that a petitioner who files a petition invoking the extraordinary writ jurisdiction has to come to Court with clean hand. Further, a petitioner who seeks equity must do equity”. The court also stated that, unlike commercial/appellate Jurisdiction, in a writ jurisdiction where relief may be denied to a petitioner on the ground that he has not approached the Court with clean hands, even when he satisfies all the ingredients of a statutory provision.
Further, the court found that the findings which were mentioned in the impugned order like premises of the petitioner being found locked during inspection; the partner of the petitioner not responding to the Summons; and L1 & L2 suppliers having issued fake and bogus invoices and passed on fake Input Tax Credit, which has been dealt with leave alone challenged.
Thereby the court found it appropriate not to entertain the writ petition and, gave the petitioner the liberty to avail the appellate remedy in accordance with the law.