Allahabad HC rejects Patanjali Ayurved’s plea towards Rs 273.5 crore GST penalty

The investigation led to allegations that Patanjali “appearing as a important particular person indulged in round buying and selling of tax invoices solely on paper with out precise provide of products”.

The Directorate Normal of GST Intelligence (DGGI), Ghaziabad issued a present trigger discover on 19 April 2024 to Patanjali Ayurved, proposing a penalty of Rs 273.51 crore beneath Part 122(1), clauses (ii) and (vii) of the Central Items and Service Tax Act 2017.

Later, the DGGI dropped tax calls for beneath Part 74 by an adjudication order dated 10 January, 2025.

The division discovered that “for all of the commodities, the portions bought had been all the time greater than the portions bought from the suppliers, thereby making the statement that every one the ITC which was availed within the impugned items was additional handed on by the petitioner”.

Regardless of dropping the tax demand, authorities determined to proceed with penalty proceedings beneath Part 122, prompting Patanjali to problem this earlier than the excessive court docket.

After listening to each side, the court docket in its judgment dated 29 Might dismissed the petition.