Mr Manoj Ramkishan Agrawal vs. Union Of INDIA

Held

The Court held that the writ petition was not maintainable on the grounds argued by the petitioners. Firstly, the Court found that the adjudicating authority had recorded detailed findings based on collected material, including the petitioners' statements, documentary evidence, and electronic records, establishing their complicity in generating fake invoices and e-way bills and their involvement in hawala transactions. The Court found the impugned order to be reasoned and not in violation of the principles of natural justice. Secondly, the Court noted that the petitioners had an efficacious statutory remedy of appeal under Section 107 of the CGST Act, 2017, where all factual findings, including the applicability of Section 122(1A), could have been examined. The Court distinguished the present case from the Bombay High Court judgment in Amit Manilal Haria, noting the widespread network and numerous transactions involved in defrauding the revenue. The Court, therefore, rejected the writ petition.

Facts

The petitioners, Mr. Manoj Ramkishan Agrawal and another, partners of M/s. Maa Renuka Trading Company, challenged an Order-in-Original dated January 30, 2026, passed by respondent No. 2, which imposed penalties under Sections 122(1A) and 122(3) of the CGST Act, 2017. The investigation concerned the generation of fake invoices and e-way bills without actual supply of goods for FY 2020-21 and 2021-22, involving a network of 23 persons/firms. During the investigation, statements were recorded, and the petitioners allegedly admitted their involvement in transactions through hawala channels and generating bogus invoices and e-way bills. The petitioners sought to quash the order, arguing a lack of finding on their liability under Section 122(1A) and violation of natural justice.

Key Issues

1. Whether the writ petition is maintainable given the existence of an alternative remedy of appeal under Section 107 of the CGST Act, 2017? The petitioners argued for maintainability, asserting that no specific finding was recorded by the adjudicating authority establishing their liability under Section 122(1A) and that the impugned order was passed in violation of natural justice principles, without considering their defence. They also contended that as partners, they could not be penalized separately if the partnership firm was already penalized. The respondents argued that the petition was not maintainable due to the efficacious alternative remedy of appeal under Section 107, and that the adjudicating authority had extensively considered all facts and defences. They further submitted that the petitioners were involved in serious illegal activities, including hawala transactions and generating bogus invoices, and had admitted their involvement.