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HIGH COURT OF DELHI
Date of Decision: 06th May, 2025
LAXMI PLASTIC PRODUCTS THROUGH ITS PROPRIETOR MR
JATIN GROVER .....Petitioner
Through: Mr. Ujjwal Jain, Advocate (Mob.
9717595497), e-mail (Ujjwaljainadvocate@gmail.com).
Through: Mr. Vinay Yadav, SPC
Mr. Divyanshu Sinha, Advocates for UOI.
Mr. Sushil Raja, SPC
Prathiba M. Singh, J. (Oral)
JUDGMENT
1. This hearing has been done through hybrid mode.
2. The present petition has been filed by the Petitioner– Laxmi Plastic Products under Article 226 of the Constitution of India challenging the show cause notice dated 29th May, 2024 (hereinafter, ‘the SCN’) issued by the Department of Trade and Taxes, GNCTD, pertaining to the Financial Year 2019-20, as also the consequent order dated 25th August, 2024 passed by the office of Sales Tax Officer Class II/ AVATO, Delhi (hereinafter, ‘the impugned order’).
3. The petition also challenges the vires of Notification No. 9/2023- Central Tax dated 31st March, 2023 and Notification No. 56/2023-Central Tax dated 28th December, 2023 as also the Notification No. 9/2023-State Tax dated 22nd June, 2023 and Notification No. 56/2023-State Tax dated 11th July, 2024 (hereinafter ‘impugned notifications’).
4. The validity of the impugned notifications was under consideration before this Court in a batch of petitions with the lead petition being W.P.(C) 16499/2023 titled ‘DJST Traders Pvt. Ltd. vs. Union of India and Ors.’. In the said batch of petitions, on 22nd April, 2025, the parties were heard at length qua the validity of the impugned notification and accordingly, the following order was passed:
validity of Notification no.9. The Patna High Court has upheld the validity of Notification no.56. Whereas, the Guwahati High Court has quashed Notification No. 56 of 2023 (Central Tax).
6. The Telangana High Court while not delving into the vires of the assailed notifications, made certain observations in respect of invalidity of Notification NO. 56 of 2023 (Central Tax). This judgment of the Telangana High Court is now presently under consideration by the Supreme Court in S.L.P No 4240/2025 titled M/s HCC-SEW-MEIL-AAG JV v. Assistant Commissioner of State Tax & Ors. The Supreme Court vide order dated 21st February, 2025, passed the following order in the said case:
consideration in this matter.
7. Dr. Muralidhar pointed out that there is a cleavage of opinion amongst different High Courts of the country. 8. Issue notice on the SLP as also on the prayer for interim relief, returnable on 7-3-2025.”
7. In the meantime, the challenges were also pending before the Bombay High Court and the Punjab and Haryana High Court. In the Punjab and Haryana High Court vide order dated 12th March, 2025, all the writ petitions have been disposed of in terms of the interim orders passed therein. The operative portion of the said order reads as under:
8. The Court has heard ld. Counsels for the parties for a substantial period today. A perusal of the above would show that various High Courts have taken a view and the matter is squarely now pending before the Supreme Court.
9. Apart from the challenge to the notifications itself, various counsels submit that even if the same are upheld, they would still pray for relief for the parties as the Petitioners have been unable to file replies due to several reasons and were unable to avail of personal hearings in most cases. In effect therefore in most cases the adjudication orders are passed ex-parte. Huge demands have been raised and even penalties have been imposed.
10. Broadly, there are six categories of cases which are pending before this Court. While the issue concerning the validity of the impugned notifications is presently under consideration before the Supreme Court, this Court is of the prima facie view that, depending upon the categories of petitions, orders can be passed affording an opportunity to the Petitioners to place their stand before the adjudicating authority. In some cases, proceedings including appellate remedies may be permitted to be pursued by the Petitioners, without delving into the question of the validity of the said notifications at this stage.
11. The said categories and proposed reliefs have been broadly put to the parties today. They may seek instructions and revert by tomorrow i.e., 23rd April, 2025.”
5. Thereafter, on 23rd April, 2025, this Court, having noted that the validity of the impugned notifications is under consideration before the Supreme Court, had disposed of several matters in the said batch of petitions after addressing other factual issues raised in the respective petitions. Additionally, while disposing of the said petitions, this Court clearly observed that the validity of the impugned notifications therein shall be subject to the outcome of the proceedings before the Supreme Court in S.L.P. No. 4240/2025 titled M/s HCC-SEW-MEIL-AAG JV v. Assistant Commissioner of State Tax & Ors.
6. However, in cases where the challenge is to the parallel State Notifications, the same have been retained for consideration by this Court. The lead matter in the said batch is W.P.(C) 9214/2024 titled Engineers India Limited v. Union of India &Ors. Considering the fact that the present petition challenges both central and state notifications, the challenge to the impugned notifications in the present writ petition shall be subject to the outcome of the decisions of the Supreme Court and this Court in the aforementioned matters.
7. In the present case, the submission of the Petitioner, on facts, is that the impugned order has already been challenged by the Petitioner before the appellate authority in accordance with Section 107 of the Central Goods and Service Tax Act, 2017 and the mandatory pre-deposit has already been furnished before the appellate authority.
8. Hence, in light of the said facts, it is directed that the appeal filed by the Petitioner shall be adjudicated upon merits by the appellate authority and the same shall not be dismissed on the ground of limitation.
9. However, it is made clear that the issue in respect of the validity of the impugned notifications is left open. Any order passed by the appellate authority shall be subject to the outcome of the decision of the Supreme Court in S.L.P No 4240/2025 titled M/s HCC-SEW-MEIL-AAG JV v. Assistant Commissioner of State Tax & Ors. and this Court in W.P.(C) 9214/2024 titled Engineers India Limited v. Union of India &Ors.
10. The present petition is disposed of in said terms. Pending applications, if any, stand disposed of.
PRATHIBA M. SINGH JUDGE RAJNEESH KUMAR GUPTA JUDGE MAY 6, 2025/MR/ss (corrected and released on 13th May, 2025)