Facts of the Case

The petitioner, M/s S.K. Overseas, had earlier approached the Delhi High Court challenging cancellation of its GST registration. Vide order dated 06.03.2025, the Court directed that cancellation of GST registration would take effect prospectively from 12.09.2023.

Subsequently, the Respondent filed a review petition under Order XLVII Rule 1 read with Sections 114 and 151 of the Code of Civil Procedure, 1908. During investigation, it emerged that one Mr. Suraj, who was claimed to be the proprietor of M/s S.K. Overseas, had categorically stated that he was merely a blacksmith, had no knowledge of any firm named S.K. Overseas, was unaware of the registered address, mobile number or business activities, and had not executed any rent agreement though signatures appeared similar.

The Court was informed that the writ petition had been filed through an advocate who had never met the alleged proprietor and that the matter was referred through an accountant, Mr. Ashish Chaurasia of M/s AMR & Associates, who provided access credentials and documents.

Issues Involved

Whether the earlier order granting relief regarding GST registration cancellation was obtained on the basis of incorrect or misleading facts, whether the petitioner firm was fictitious and created through impersonation, whether the proceedings amounted to fraud on the Court, and what directions were required to address misuse of judicial process in GST matters.

Petitioner’s Arguments

Counsel appearing for the petitioner submitted that he had never personally met the alleged proprietor and that the case was referred to him by an accountant. He candidly placed WhatsApp communications on record showing how credentials and documents were provided by the accountant. Counsel submitted that he had no independent knowledge of the genuineness of the proprietor.

Respondent’s Arguments

The Revenue contended that the very existence of the petitioner firm was doubtful and that the relief earlier granted was obtained by suppressing material facts. It was submitted that the case was part of a larger pattern involving fictitious GST firms created through impersonation and misuse of professional intermediaries.

Court Order / Findings

The Delhi High Court took serious note of the disclosures made during review proceedings and observed that several GST matters before the Court revealed a disturbing trend where fictitious persons were shown as proprietors, affidavits were notarised without meeting clients, and petitions were filed based on references from accountants or consultants.

The Court referred to its earlier judgment in M/s S.R. Enterprises v. Principal Commissioner of Goods and Services Tax, East Delhi, where FIRs were directed to be registered after finding that petitions were filed on behalf of fictitious entities using forged documents. The Court held that the present case disclosed a similar pattern.

In light of the above, the Court held that the earlier order dated 06.03.2025 could not stand and proceeded to recall the relief earlier granted. The Court refrained from making adverse observations against the advocate at this stage, noting his disclosure and regular practice before the Court.

The Court directed Mr. Ashish Chaurasia, proprietor of M/s AMR & Associates, to remain personally present before the Court on the next date of hearing. Directions were also issued for service of the order upon him through WhatsApp and through the concerned SHO, and for intimation to Standing Counsel (Criminal).

Important Clarification

The High Court clarified that GST litigation involving fictitious entities, impersonation, forged affidavits and misuse of professional intermediaries amounts to serious abuse of judicial process. Courts are empowered to recall orders obtained on incorrect facts and to initiate further inquiry where fraud on the Court is prima facie established.

Final Outcome

The review petition was allowed. The earlier order dated 06.03.2025 granting prospective relief on GST registration cancellation was recalled. The matter was directed to be listed for further proceedings, and Mr. Ashish Chaurasia of M/s AMR & Associates was directed to remain personally present before the Court on 21.11.2025 for further inquiry. All consequential directions regarding service and police intimation were issued accordingly.

Source Link- https://delhihighcourt.nic.in/app/showFileJudgment/PMS19092025CW61242024_114921.pdf

 

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