JUDGMENT

Mrs. Manisha Batra, J.

This common order shall dispose of two above mentioned petitions which have been filed under Article 226 of the Constitution of India by the petitioners making prayer for issuing writs of certiorari for quashing the orders dated 18.05.2021 whereby, the request of the petitioners of both petitions for grant of refund had been declined by respondent No.1. They have also made prayer for issuing writs of mandamus thereby, directing respondent No.1 to refund the amounts as mentioned in both these petitions. As common question of facts and law have arisen in these petitions, therefore, they are taken up together for disposal. However, for the sake of convenience, the facts are being extracted from CWP-10923-2021.

2. As pleaded, the petitioner-M/S Parsvnath Traders, a firm under the proprietorship of Krishan Jain, is engaged in the business of trading of different types of chemicals. During the years 2018-19 and 2019-20, it had made purchases in the normal course of business from its regular supplier- M/s Royal Sales Corporation, Rohtak (for short-"M/s Royal"). The goods purchased by the petitioner from M/S Royal were received along with requisite invoices, E Way Bills, Goods receipts and other supporting documents. The petitioner paid GST on the purchases so made, and had subsequently, availed Input Tax Credit (for short-"ITC") for sums of Rs.60.89 lacs and Rs.1.25 crore respectively. On 05.02.2021, the officials of the Department of Central Goods and Services Taxation (for short-"CGST") had searched the business premises of the petitioner and verbally informed it during investigation that there were allegations that the petitioner had got issued bogus invoices from M/S Royal without receiving goods in fact and had availed ITC in an illegal manner. The petitioner was forced to deposit a sum of Rs.20 lacs on the same day by the officials of CGST Department and was called upon to appear in their office on 08.02.2021. They also got deposited an additional amount of Rs.30,70,216/- from the petitioner on 16.02.2021. The petitioner made oral as well as written requests to the respondents to supply copy of Panchnama and statements recorded against it but the same were not supplied. The respondents even did not issue any show cause notice and no order determining its tax liability had been passed by them. The petitioner made another request in writing to the respondents to refund the amount of Rs.50,70,216/- (Rs.20.00,000+Rs.30,70,216) got deposited from it but the prayer made by the petitioner was rejected by order dated 18.05.2021 which was communicated through e-mail. Aggrieved by the same, the petitioner challenged the action of the respondents on the ground that the amount of Rs.50,70,216/- was got deposited from it without issuance of any show cause notice, passing any adjudication order and also without following the procedure prescribed by law. The provisions of Section 74 (5) of the Central Goods and Service Tax Act, 2017 (for short-the Act) which were mandatory in nature had not been complied and principles of natural justice were violated. Hence, prayer had been made by the petitioner for setting aside the order rejecting the request made by it for refund of the amount of Rs.50.70 lacs and also for further directing the respondents No.1 to refund the above said amount.

3. In response to the notice of the petition, the respondents filed a joint reply by way of affidavit submitting therein that on receipt of a report regarding evasion of tax and availing of ITC by certain tax payers on the basis of fake transactions, from the Directorate General of Analytics and Risk Management, New Delhi (DGARM) in the year 2018 and on going through the data shared by the DGARM of tax payers who were involved in issuance of availment of fake ITC, the respondents had verified data of M/S Royal on GST portal which revealed that this firm had passed ITC amounting to Rs.5,15,12,408/- within a short span of 13-15 months af