- Karnataka High Court granted anticipatory bail to three GST-registered purchasers facing arrest under Section 132 CGST/KGST for alleged bogus ITC linked to supplier fraud.
- The Court held that a purchaser who has tax invoices, paid invoice value plus GST through banking channels, and regularly filed returns cannot ordinarily be denied ITC solely because the supplier defaulted.
- Custodial interrogation/arrest is not justified unless prima facie fraud or collusion between the purchaser and supplier is established.
- The Court noted the petitioners’ cooperation with summons, absence of antecedents, and that the alleged offence is compoundable and carries a maximum five-year punishment.
Source: a2ztaxcorp.net
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
