M/S Technosys Integrated Solutions Pvt Ltd vs Union Of India & Ors.

* IN THE HIGH COURT OF DELHI AT NEW DELHI

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% Reserved on: 9 March, 2026
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Pronounced on: 16 March, 2026


+ W.P.(C) 5581/2025
M/S TECHNOSYS INTEGRATED SOLUTIONS PVT LTD,
Through its Authorised Representative
Mr. Rakesh Dhar
A Private Limited Company
Having its registered office at
No. 51, Functional Industrial Estate,
Patparganj, Delhi
Delhi – 110005 ..... PETITIONER
Through: Mr. Abhishek Rastogi, Ms. Pooja
M Rastogi, Ms. Trishala Trivedi,
Ms. Meenal Songire and
Mr. Harsh Pandya, Advocates
versus

1. UNION OF INDIA

Through its Secretary,
Department of Revenue, Ministry of Finance,
Government of India, North Block,
New Delhi -110001 ..... RESPONDENT NO. 1

2. CGSTR NORTH COMMISSIONERATE,

Additional Commissioner,
CGST Delhi North Commissionerate,
C.R. Building,
I.P. Estate, New Delhi – 110002 ..... RESPONDENT NO. 2
Signature Not Verified
Signed By:ANKITA RAI
Signing Date:17.03.2026
14:48:08
W.P.(C) 5581/2025 Page 1 of 12

3. OFFICE OF THE COMMISSIONER CGST, AUDIT-I

Through Commissioner, CGST Audit-I,
CR Building, IP Estate,
New Delhi ..... RESPONDENT NO. 3
Through: Ms. Anushree Narain, Mr. Yamit
Jetley and Mr. Naman Choula,
Advocates for R-2 and R-3

CORAM:
HON’BLE MR. JUSTICE NITIN WASUDEO SAMBRE
HON’BLE MR. JUSTICE AJAY DIGPAUL

JUDGMENT

AJAY DIGPAUL, J.
1. The petitioner, M/s Technosys Integrated Solutions Pvt. Ltd., is a
1
private limited company registered under the Goods and Services Tax
laws and is stated to be engaged in the supply/installation of CCTV
surveillance systems.
2. The petitioner was subjected to GST audit for the period from FY
2017-18 to FY 2021-22. An intimation in Form ADT-01 dated
20.03.2023 was issued by the Audit Wing of Central Goods and Services
2
Tax in that regard.
3. Pursuant thereto, an Observation Memo dated 06.11.2023 came to
be issued upon scrutiny/verification of the petitioner‟s records during

1
Hereinafter “GST”
2
Hereinafter “CGST”
Signature Not Verified
Signed By:ANKITA RAI
Signing Date:17.03.2026
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W.P.(C) 5581/2025 Page 2 of 12

audit, and the said Observation Memo indicated a GST liability of
₹49,52,923/-.
4. On 07.11.2023, as per the petitioner, the said amount of
₹49,52,923/- through DRC-03, which was made during audit, was paid
without contest.
5. Thereafter, on 16.11.2023, an email was issued from the office of
respondent no. 3 calling for copies of contracts. Subsequently, Audit
Report No. 728/2023-24 dated 23.01.2024 was issued. The petitioner
filed a reply dated 05.02.2024 to the Audit Report.
6. In the meantime, Form DRC-01A dated 31.01.2024, bearing
Reference No. 464, was issued to the petitioner with reference to Audit
3
Para VII, and according to the petitioner‟s own Show Cause Notice
reply, audit paras I to VI stood settled and the dispute thereafter
proceeded in respect of audit para VII. A reply to the said DRC-01A was
also filed by the petitioner.
7. Thereafter, SCN No. 09/2024-25 along with SCN in Form DRC-
01 dated 09.04.2024, later followed by a corrigendum dated 13.11.2024,
was issued to the petitioner. As noticed in the SCN, it was proposed that:
firstly, a GST demand of ₹18,67,69,338/- on the allegation that the
petitioner had wrongly availed the benefit of Notification No. 11/2017-
CT (Rate) dated 28.06.2017 by treating its supplies as works contract
services taxable at 12% for the period FY 2017-18 to FY 2021-22;
secondly, a further GST demand of ₹1,30,00,000/- on account of alleged

3
Hereinafter “SCN”
Signature Not Verified
Signed By:ANKITA RAI
Signing Date:17.03.2026
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W.P.(C) 5581/2025 Page 3 of 12

non-payment of GST at 28%; and lastly, penalties under Section 74 and
4
Section 122(1)(xvii) of the Central Goods and Services Tax Act, 2017 .
8. The petitioner submitted a detailed reply to the said SCN on
09.05.2024 before the adjudicating authority.
9. In its reply dated 09.05.2024, the petitioner stated, inter alia , that it
was engaged in providing works contract services relating to the
installation of security cameras and CCTV systems. It submitted that the
audit had earlier culminated in the Observation Memo dated 06.11.2023
and that it had already responded to both the Audit Report and DRC-01A
and they denied any suppression or wilful misstatement. It further
contended that it was entitled to the concessional rate of 12% under Sl.
No. 3(vi) of Notification No. 11/2017-CT (Rate) dated 28.06.2017 on the
basis that its supplies constituted works contract services rendered to
government agencies. The petitioner also asserted in the said reply that
CCTV installations qualified as works contract within the meaning of
Section 2(119) of the CGST Act.

10. A personal hearing was thereafter held before the adjudicating
authority.
5
11. Thereafter, Order-in-Original No. DE/GST/ADC (JR) 224/2024-
25 dated 31.01.2025 came to be passed with reference to SCN No.
09/2024-25 dated 10.04.2024 and corrigendum dated 13.11.2024. The
said OIO dated 31.01.2025 confirmed the entire demand proposed in the

4
Hereinafter “CGST Act”
5
Hereinafter “OIO”
Signature Not Verified
Signed By:ANKITA RAI
Signing Date:17.03.2026
14:48:08
W.P.(C) 5581/2025 Page 4 of 12

SCN, namely: GST of ₹18,67,69,338/- on the issue relating to alleged
wrongful availment of the 12% rate under Notification No. 11/2017-CT
(Rate); GST of ₹1,30,00,000/- on the allegation of non-payment of GST
at 28%; and penalty under Section 74 as well as Section 122(1)(xvii) of
the CGST Act, resulting in a total penalty of 200%.
12. After the passing of the said OIO, multiple Form GST DRC-07
summaries came to be issued with reference to the order dated
31.01.2025. For FY 2017-18, DRC-07 summaries were issued on
03.02.2025, 04.02.2025 and 05.02.2025.
13. It is in these circumstances that the present writ petition came to be
filed before this Court, wherein the petitioner has sought quashing of the
impugned OIO dated 31.01.2025 and dispensation of the requirement of
pre-deposit on the ground that an amount of ₹49,52,923/- had already
been paid on 07.11.2023 during the course of audit as part of admitted
liability.
14. When the present matter was taken up on 30.04.2025 for the first
time, this Court crystallised the grounds raised in the petition and
identified the specific issue that arose for consideration in the matter.
Inasmuch as the said order narrows the scope of adjudication, the
relevant paras thereof are reproduced below for the sake of clarity:
“4. The broad grounds raised by Mr. Abhishek A Rastogi, ld. Counsel
for the Petitioner are as under:

(i) In the Audit Observation Memo dated 6th November 2023,
the differentiation of contract of works service taxed at
12%and the second category of service tax for supply of goods
at 18% was not raised in the Observation Memo.
Signature Not Verified
Signed By:ANKITA RAI
Signing Date:17.03.2026
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W.P.(C) 5581/2025 Page 5 of 12

(ii) Moreover, multiple years have been clubbed in the Show
Cause Notice and common demands have been raised.
(iii) That penalty has been imposed under Section 75(3) of the
Central Goods and Service Tax Act, 2017 (hereinafter, „ CGST
Act ‟) despite the penalty under Section 74 of the CGST Act
having already been imposed.
5. Heard. There are matters before this Court in which the question of
multiple years being clubbed in the Show Cause Notice has been
considered by this Court and the same is part-heard. The said matters
are listed on 20th May, 2025.

6. In so far as the categorisation of the goods and services is
concerned, that would be an issue which would have to be raised in an
appeal. However, insofar as consolidation of multiple years is
concerned, since the issue is part heard, the Court adjourns the matter
to 20th May, 2025.”
15. Although the order dated 30.04.2025 crystallises the controversy
which arises for consideration, it would also be apposite to briefly
mention the major grounds urged, as further elaborated in the written
submissions dated 09.02.2026. Broadly, the petitioner challenges the
impugned proceedings on the ground that the SCN and the OIO
impermissibly consolidate multiple financial years into a single
adjudicatory exercise, even though, according to the petitioner, the
present matter does not concern fraudulent availment or utilisation of
6
Input Tax Credit , but arises out of an interpretational dispute as to the
nature of the supplies effected by it and the rate of tax applicable thereto.
The petitioner‟s case is that each financial year ought to have been dealt
with separately and that the passing of a common order has resulted in

6
Hereinafter “ITC”
Signature Not Verified
Signed By:ANKITA RAI
Signing Date:17.03.2026
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W.P.(C) 5581/2025 Page 6 of 12

prejudice by collapsing distinct causes of action, returns, limitation
periods and legal defences.
16. The petitioner has further urged that the reliance sought to be
placed by the respondents on the decisions of this Court in Ambika
Traders through Proprietor Gaurav Gupta v. Additional
7 8
Commissioner and Mathur Polymers v. Union of India & Ors. is
misconceived in the facts of the present case. As per the petitioner, both
the said decisions were rendered in the context of allegations relating to
fraudulent availment or utilisation of ITC extending across financial
years, whereas the present case, as submitted, does not involve fake
invoices, circular trading, non-existent suppliers or clandestine credit
chains, but raises a pure issue of classification and rate applicability. It is
on this basis that the petitioner contends that the ratio of the said
judgments cannot be mechanically applied to the present dispute.
17. It is also urged on behalf of the petitioner, with reference to the
written submissions, that several Benches of the Bombay High Court,
after considering the very judgments of this Court relied upon by the
respondents, have consciously taken a different view in matters not
involving ITC fraud, including Milroc Good Earth Developers v. Union
9

of India & Ors. , Rite Water Solutions (India) Ltd. v. Joint
10
Commissioner, CGST & Central Excise, Nagpur & Ors. , M/s Paras

7
2025 SCC OnLine Del 6913
8
2025 SCC OnLine Del 6892
9
(2025) 36 CENTAX 97
10
2025:BHC-NAG:13213-DB
Signature Not Verified
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Signing Date:17.03.2026
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W.P.(C) 5581/2025 Page 7 of 12

11
Stone Industries v. Union of India & Ors. and AR Traders, through
its proprietor Shri Abdul Rashid v. Joint Commissioner, CGST &
12
Central Excise, Nagpur . The petitioner specifically relies upon Milroc
Good Earth Developers to contend that the Bombay High Court
distinguished Ambika Traders on the footing that the facts before the
Delhi High Court related to wrongful availment of ITC over subsequent
years, whereas the matter before it arose in a different factual and legal
setting. It is also pointed out that the Bombay High Court took note of
the withdrawal of the Special Leave Petition against Ambika Traders
with an observation that the said decision would not apply to the facts of
other cases, and independently examined the expressions “for any
period” and “for such period(s)” in support of year-wise adjudication in
non-fraud cases.
18. Heard Mr. Abhishek A. Rastogi, learned Counsel for the petitioner
and Ms. Anushree Narain, learned Senior Standing Counsel and perused
the documents on record.

19. At the outset, this Court makes it clear that it is not entering into
the merits of the controversy as to whether there was, in fact, any
fraudulent availment of ITC. That issue lies squarely within the domain
of the statutory appellate authority. An efficacious alternative remedy is
available to the petitioner by way of an appeal under Section 107 of the
CGST Act and Rule 109A of CGST Rules, 2017, which has admittedly

11
2026:BHC-NAG:339-DB
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2026:BHC-NAG:732-DB
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Signing Date:17.03.2026
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W.P.(C) 5581/2025 Page 8 of 12

not been exhausted. It is well settled that where such an alternative
statutory remedy exists, the writ court ordinarily ought not to undertake
an examination on merits. This principle stands clearly laid down by the
Hon‟ble Supreme Court in a catena of decisions, including Whirlpool
13

Corporation v. Registrar of Trademarks, Mumbai and Harbanslal
14
Sahnia v. Indian Oil Corpn. Ltd. .
20. This Court shall also deal with the submission advanced by Mr.
Rastogi that the decision of this Court in Ambika Traders (Supra) does
not govern the present case on the ground that the said judgment arose in
the context of fraudulent availment or utilisation of ITC extending across
financial years.
21. As already observed hereinabove, this Court is not delving in the
present proceedings to determine whether fraud is, in fact, made out and
therefore will not undertake the adjudication on that point. However,
insofar as the submission seeks to confine Ambika Traders only to cases
involving allegations of fraudulent availment or utilisation of ITC across
financial years, this Court is unable to agree. In this context, we deem it
important to reproduce the relevant para of the said judgment:
“ 43. Insofar as the issue of consolidated notice for various financial
years is concerned, a perusal of section 74 of the CGST Act would
itself show that at least insofar as fraudulently availed or utilised ITC
is concerned, the language used in section 74(3) of the CGST Act and
section 74(4) of the CGST Act is “for any period” and “for such
periods” respectively. This contemplates that a notice can be issued
for a period which could be more than one financial year. Similar is

13
(1998) 8 SCC 1
14
(2003) 2 SCC 107

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Signing Date:17.03.2026
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W.P.(C) 5581/2025 Page 9 of 12

the language even in section 73 of the CGST Act. The relevant
provisions read as under:
“ 73. Determination of tax, pertaining to the period up to
financial year 2023-2024, not paid or short paid or erroneously
refunded or input-tax credit wrongly availed or utilised for any
reason other than fraud or any wilful misstatement or suppression
of facts.— (1) and (2)…

(3) Where a notice has been issued for any period under sub-
section (1), the proper officer may serve a statement, containing the
details of tax not paid or short paid or erroneously refunded or input-
tax credit wrongly availed or utilised for such periods other than those
covered under sub-section (1), on the person chargeable with tax.
(4) The service of such statement shall be deemed to be service of
notice on such person under sub-section (1), subject to the condition
that the grounds relied upon for such tax periods other than those
covered under sub-section (1) are the same as are mentioned in the
earlier notice.
…
74. Determination of tax, pertaining to the period up to
financial year 2023-2024, not paid or short paid or erroneously
refunded or input-tax credit wrongly availed or utilised by reason
of fraud or any wilful misstatement or suppression of facts.— (1)
and (2)…

(3) Where a notice has been issued for any period under sub-
section (1), the proper officer may serve a statement, containing the
details of tax not paid or short paid or erroneously refunded or input-
tax credit wrongly availed or utilised for such periods other than those
covered under sub-section (1), on the person chargeable with tax.
(4) The service of statement under sub-section (3) shall be deemed
to be service of notice under sub-section (1) of section 73, subject to
the condition that the grounds relied upon in the said statement, except
the ground of fraud, or any wilful misstatement or suppression of facts
to evade tax, for periods other than those covered under sub-section
(1) are the same as are mentioned in the earlier notice.”

22. The aforesaid extract from Ambika Traders leaves no manner of
doubt that this Court, in the said judgment, contemplated and accepted
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W.P.(C) 5581/2025 Page 10 of 12

consolidation of SCNs covering multiple financial years under both
Section 73 and Section 74 of the CGST Act.
23. This Court has also considered the reliance placed by Mr. Rastogi
on the judgments rendered by the Bombay High Court, which may have
taken a view that departs, in certain respects, from that expressed in
Ambika Traders . However, so far as this Court is concerned, it remains
bound by the view taken in Ambika Traders and must proceed
accordingly. It is also relevant to note that Special Leave Petition (C) No.
23774/2025 was preferred against the decision in Ambika Traders before
the Hon‟ble Supreme Court and, after some hearing, the same came to be
dismissed as not pressed.
24. Mr. Rastogi also submitted that petitions involving a similar issue
are presently pending before the Hon‟ble Supreme Court and requested
that this Court defer the matter for a few more weeks. However, this
submission cannot take the matter any further. Mere pendency of
proceedings before the Supreme Court does not efface the binding nature
of the judgment presently holding the field. In this regard, the Hon‟ble
Supreme Court in Union Territory of Ladakh v. Jammu & Kashmir
15
National Conference , has held as under:
“ 35. We are seeing before us judgments and orders by High Courts not
deciding cases on the ground that the leading judgment of this Court
on this subject is either referred to a larger Bench or a review petition
relating thereto is pending. We have also come across examples of
High Courts refusing deference to judgments of this Court on the
score that a later Coordinate Bench has doubted its correctness. In this
regard, we lay down the position in law. We make it absolutely clear

15
2023 SCC OnLine SC 1140
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W.P.(C) 5581/2025 Page 11 of 12

that the High Courts will proceed to decide matters on the basis of the
law as it stands. It is not open, unless specifically directed by this
Court, to await an outcome of a reference or a review petition, as the
case may be. It is also not open to a High Court to refuse to follow a
judgment by stating that it has been doubted by a later Coordinate
Bench. In any case, when faced with conflicting judgments by
Benches of equal strength of this Court, it is the earlier one which is to
be followed by the High Courts, as held by a 5-Judge Bench in
16
National Insurance Company Limited v. Pranay Sethi . The High
Courts, of course, will do so with careful regard to the facts and
circumstances of the case before it.”

25. We, therefore, find no cause to interfere with the impugned OIO
and grants liberty to the petitioner to avail of such remedies as may be
available to it in accordance with law.
26. This Court once again makes it clear that it has not examined or
expressed any opinion on the merits of the case and that all rights and
contentions of the parties in that regard are left open.
27. For all the aforesaid reasons, the present writ petition, along with
pending applications is dismissed.

AJAY DIGPAUL
(JUDGE)



NITIN WASUDEO SAMBRE
(JUDGE)


MARCH 16, 2026/gs/ yr

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(2017) 16 SCC 680
Signature Not Verified
Signed By:ANKITA RAI
Signing Date:17.03.2026
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