Once Input Tax Credit Is Wrongfully Availed Due To Fraud Or Suppression, State Officer Can Issue Notice Even Without Central Action: Patna HC

The Patna High Court ruled that state GST officers can independently issue notices for wrongful ITC claims without waiting for central authorities, even in fraud cases. Justice Rajeev Ranjan Prasad held that Section 74(1) of BGST Act empowers both state and central officers to act against fraudulent credits within their jurisdiction. The case involved ₹6.8 crore ITC demand where the assessee argued only central authorities could investigate pan-India frauds. This judgment strengthens states' enforcement capabilities against GST evasion, preventing jurisdictional overlaps from impeding tax recovery. However, the court cautioned against duplicate proceedings and directed officers to coordinate when investigations overlap. The ruling clarifies the concurrent powers framework under GST while expecting administrative cooperation between state and central tax authorities.