GST Audit File Transfer Between Wings Is Administrative, Cannot Be Challenged In Writ Petition: Delhi High Court

The Delhi High Court has held that the transfer of a Goods and Services Tax (GST) audit file from the Audit Wing to the Anti-Evasion Wing is essentially an administrative exercise.

It further held that in the absence of any statutory prohibition under the Central Goods and Services Tax Act, 2017 against such transfer, the transfer by itself cannot be a ground for interference in writ jurisdiction.

The division bench of Justices Anil Kshetarpal and Harish Vaidyanathan Shankar was dealing with a petition filed by M/s Siemens Healthcare Pvt. Ltd. challenging the transfer of its GST audit file from the Audit Wing to the Anti-Evasion Wing.

Petitioner contended that the Additional Commissioner of the Audit Wing had no power to transfer the file to the Anti-Evasion Wing.

It further argued that under Section 65 of the CGST Act, an audit is required to be completed within three months from its commencement, subject to an extension of up to six months where the Commissioner is satisfied. According to the petitioner, the audit in the present case had been completed after nearly two years.

The department, however, submitted that the Additional Commissioner (Audit) and the Additional Commissioner (Anti-Evasion Wing) were functioning under the same Commissionerate. They alleged that the Petitioner had not cooperated with the Audit Wing and had failed to furnish the documents sought, following which the matter was transferred to the Anti-Evasion Wing.

Refusing to interfere with the transfer, the Court observed,

“The transfer of the file from one wing to another is, essentially, an administrative exercise. In the absence of any statutory prohibition under the CGST Act against such transfer, the same cannot, by itself, be a ground for interference in exercise of writ jurisdiction.”

The court also noted that while transferring the file, the Additional Commissioner (Audit) had recorded that despite repeated notices, the taxpayer had submitted only a few documents through email and had not furnished the financial documents relating to its Delhi branch.

In view of these circumstances, the Court held that it was not appropriate to interfere in the exercise of its writ jurisdiction.

However, it clarified that Petitioner would be at liberty to raise all objections available before the Adjudicating Authority.

For Petitioner: Advocate Bharat Raichandani, Advocate Deepak Kumar Khokhar, Advocate Rishav Raj, Advocate Chaitanya G. Tripathi, Advocate Prachi Sharma.

For Respondents: Special Public Counsel Sahil Munjal for R1; Standing Counsel Shubham Tyagi, CBIC, with Advocate Navruti Ojha for R2 to R6.