Registration of buyer can not be cancelled if seller committed fraud
Facts of the case
Proper Officer issued show cause notice that
“you have claimed ITC (Input Tax Credit) against fake invoices issued by nonexistent supplier”.
Thereafter proper officer cancelled taxpayer registration on the ground that “in case, Registration has been obtained by means of fraud, willful misstatement or suppression of facts,”.
Department has failed to show that the Petitioner as a purchasing dealer deliberately availed of the ITC in respect of the transactions with an entity knowing that such an entity was not in existence.
order of Proper officer rejecting the Petitioner’s application for revocation of its cancellation of registration and the impugned appellate order rejecting the Petitioner’s appeal are hereby set aside.