Full Text
HIGH COURT OF DELHI
Date of Decision: 05th May, 2025
NEELGIRI POLY PLAST .....Petitioner
Through: Mr. Rakesh Kumar and Mr. Parveen Gambhir, Advocate, (M-9810220294)
OTHERS .....Respondents
Through: Appearance not given.
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 – Neelgiri Poly Plast under Article 226 of the Constitution of India, inter alia, assailing the Show Cause Notice dated 26th September, 2023 and impugned order dated 17th December, 2023 passed by Respondent No. 2- Sales Tax Officer Class II/AVATO, Delhi Goods and Service Tax, Ward-63, Zone-6, New Delhi.
3. A challenge has also been raised to Notification Nos. 09/2023- Central Tax dated 31st March 2023, 09/2023- State Tax dated 22nd June 2023 (hereinafter, ‘impugned notifications’).
4. The impugned notifications were under consideration before this Court in a batch of matters with the lead matter 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 notifications and accordingly, the following order was passed:
Notification No.13/2022 dated 5-7-2022 & Notification Nos.[9] and 56 of 2023 dated 31-3-2023 & 8-12-2023 respectively.
2. However, in the present petition, we are concerned with Notification Nos.[9] & 56/2023 dated 31- 3-2023 respectively.
3. These Notifications have been issued in the purported exercise of power under Section 168 (A) of the Central Goods and Services Tax Act. 2017 (for short, the "GST Act").
4. We have heard Dr. S. Muralidhar, the learned Senior counsel appearing for the petitioner.
5. The issue that falls for the consideration of this Court is whether the time limit for adjudication of show cause notice and passing order under Section 73 of the GST Act and SGST Act (Telangana GST Act) for financial year 2019-2020 could have been extended by issuing the Notifications in question under Section 168-A of the GST Act.
6. There are many other issues also arising for 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:
issued in purported exercise of power under Section 168- A of the Act which have been challenged, and we direct that all these present connected cases shall be governed by the judgment passed by the Hon'ble Supreme Court and the decision thereto shall be binding on these cases too.
67. Since the matter is pending before the Hon'ble Supreme Court, the interim order passed in the present cases, would continue to operate and would be governed by the final adjudication by the Supreme Court on the issues in the aforesaid SLP-4240-2025.
68. In view of the aforesaid, all these connected cases are disposed of accordingly along with pending applications, if any.”
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. Subsequently, this Court, having noted that the validity of the Central Notifications—Notification Nos. 56/2023-CT and 09/2023-CT—is presently under consideration before the Hon’ble Supreme Court in S.L.P. No. 4240/2025 titled M/s HCC-SEW-MEIL-AAG JV v. Assistant Commissioner of State Tax & Ors., had disposed of matters wherein challenge was limited to the Central Notifications, after addressing other factual issues raised in the respective petitions, with a direction that such matters would remain subject to the outcome of the proceedings before the Supreme Court. 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.
6. However, on facts, the submission of the ld. Counsel for the Petitioner is that the impugned Show Cause Notice dated 26th September, 2023 was uploaded on ‘Additional Notices Tab’ so he did not have the knowledge of Show Cause Notice and the demand to the tune of Rs. 8,51,172/- vide the impugned order dated 17th December, 2023 without giving him a proper opportunity to be heard.
7. In fact this Court in W.P.(C) 13727/2024 titled ‘Neelgiri Machinery through its Proprietor Mr. Anil Kumar V. Commissioner Delhi Goods And Service Tax And Others’, under similar circumstances where the SCN was uploaded vide ‘Additional Notices Tab’ had remanded the matter in the following terms:
access of the Notices as they were projected on the GST Portal under the tab ‘Additional Notices & Orders’. He submits that the said issue has now been addressed and the ‘Additional Notices & Orders’ tab is placed under the general menu and adjacent to the tab ‘Notices & Orders’.
8. In view of the above, the present petition is allowed and the impugned order is set aside.
9. The respondent is granted another opportunity to reply to the impugned SCN within a period of two weeks from date. The Adjudicating Authority shall consider the same and pass such order, as it deems fit, after affording the petitioner an opportunity to be heard.
10. The present petition is disposed of in the aforesaid terms.
11. All pending applications are also disposed of.”
7. The impugned demand orders dated 23rd April, 2024 and 5th December, 2023 are accordingly set aside. In response to show cause notices dated 04th December, 2023 and 23th September, 2023, the Petitioner shall file its replies within thirty days. The hearing notices shall now not be merely uploaded on the portal but shall also be e-mailed to the Petitioner and upon the hearing notice being received, the Petitioner would appear before the Department and make its submissions. The show cause notices shall be adjudicated in accordance with law.
8. The petitions are disposed of in the above terms. The pending application(s), if any, also stand disposed of.”
8. It is relevant to note that post 16th January 2024, the Department has effected changes in the portal to ensure that the Show Cause Notices become visible to parties. However, in this case, considering the Show Cause Notice in the present case has been issued on 26th September, 2023 the Court is inclined to grant the Petitioner an opportunity to be properly heard.
9. In view thereof, the impugned order dated 17th December, 2023 is set aside and the Petitioner is permitted to file a reply to the Show Cause Notice dated 26th September, 2023 on or before 10th July, 2025. Upon filing such a reply a personal hearing ought to be provided to the Petitioner. The personal hearing notices shall be communicated to the Petitioner on the following email address and mobile nos.: Email ID: gambuirpk7@gmail.com Mob. No.:981022029[4]
10. After hearing the Petitioner, the Adjudicating Authority shall pass the order of adjudication. However, it is again made clear that the issue in respect of the validity of the impugned notifications is left open and the order of the adjudicating authority shall be subject to the outcome of the decision of the Supreme Court and this Court.
11. All rights and remedies of the parties are left open. Access to the GST Portal, if not already available, shall be ensured to be provided to the Petitioner to enable access to the notices and related documents.
12. The present petition is disposed of in these terms. Pending application(s), if any, shall also stand disposed of.
PRATHIBA M. SINGH JUDGE RAJNEESH KUMAR GUPTA JUDGE MAY 05, 2025/da/Ar. (corrected & released on 13th May, 2025)