Full Text
HIGH COURT OF DELHI
Date of Decision: 26th September, 2025
M/S SAHNI INDUSTRIES THROUGH ITS PROPRIETOR SH.
ASCHARAJ LAL SAHNI .....Petitioner
Through: Mr. Vineet Bhatia, Mr. Keshav Garg, Mr. Abinav Sharde & Mr. Manoj Kant
Mishra, Advs.
Through: Mr Vivek Sharma, Senior Panel Counsel
Ms. Vaishali Gupta, Panel Counsel (Civil), GNCTD.
JUDGMENT
1. This hearing has been done through hybrid mode.
2. The Petitioner- M/S Sahni Industries through its Proprietor Sh. Ascharaj Lal Sahni, has filed the present petition under Articles 226 and 227 of the Constitution of India, inter alia, challenging the impugned order dated 27th August, 2024 passed by the Sales Tax Officer Class II/Avato Ward 53, Zone- 3, Delhi (hereinafter, ‘impugned order’). The present petition also challenges the impugned Show Cause Notice dated 30th May, 2024 issued by Sales Tax Officer Class II/Avato Ward 53, Zone-3, Delhi (hereinafter ‘impugned SCN’).
3. At the outset, ld. Counsel for the Petitioner submits that the challenge to Section 16(2)(c) of the Central Goods and Services Tax Act, 2017/Delhi Goods and Services Tax Act, 2017 is not pressed. Additionally, challenge to the orders dated 4th July 2025, 6th July 2024, 9th August 2024, 16 November 2023, 7 November 2023, 16th October 2023 and 29th September 2023, issued by the Department of Trade and Taxes, Government of National Capital Territory of Delhi, is also not pressed.
4. The present petition also challenges the following Notifications: ● Notification No. 9/2023- Central Tax dated 31st March, 2023; ● Notification No. 56/2023- Central Tax dated 28th December, 2023; ● Notification No. 09/2023-State Tax dated 22nd June, 2023 and ● Notification No. 56/2023- State Tax dated 11th July, 2024 (hereinafter, ‘the impugned notifications’).
5. The challenge in the present petition is similar to a batch of petitions wherein inter alia, the impugned notifications were challenged. W.P.(C) NO. 16499/2023 titled DJST Traders Private Limited v. Union of India &Ors.was the lead matter 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:
granted contrary to the mandate under Section 168A of the Central Goods and Services Tax Act, 2017 and ratification was given subsequent to the issuance of the notification. The notification incorrectly states that it was on the recommendation of the GST Council. Insofar as the Notification No. 56 of 2023 (State Tax) is concerned, the challenge is to the effect that the same was issued on 11th July, 2024 after the expiry of the limitation in terms of the Notification No.13 of 2022 (State Tax).
5. In fact, Notification Nos. 09 and 56 of 2023 (Central Tax) were challenged before various other High Courts. The Allahabad Court has upheld the 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:
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:
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.”
6. The abovementioned writ petition and various other writ petitions have been disposed of by this Court on subsequent dates, either remanding the matters or relegating the parties to avail of their appellate remedies, depending upon the fact situation. All such orders are subject to further orders of the
7. As observed by this Court in the order dated 22nd April, 2025 as well, since the challenge to the above mentioned notifications is presently under consideration 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., the challenge made by the Petitioner to the impugned notifications in the present proceedings shall also be subject to the outcome of the decision of the
8. 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.
9. On facts, it is submitted by the ld. Counsel for the Petitioner that in the present case, the impugned SCN was issued on 30th May, 2024. No reply was filed to the impugned SCN. The impugned order was then passed raising a demand to the tune of Rs. 14,33,412.00 including the tax amount to the tune of Rs. 7,41,574.00.
10. The Court has heard the parties. In fact, this Court in Sugandha Enterprises through its Proprietor Devender Kumar Singh (Supra), under similar circumstances where no reply was filed to the SCN had remanded the matter in the following terms:
9. Accordingly, the impugned order is set aside. The Petitioner is granted 30 days’ time to file the reply to SCN. Upon filing of the reply, the Adjudicating Authority shall issue to the Petitioner, a notice for personal hearing. The personal hearing notice shall be communicated to the Petitioner on the following mobile no. and e-mail address:....”
11. Under such circumstances, considering the fact that the Petitioner did not get a proper opportunity to be heard and no reply to the SCN has been filed by the Petitioner, the matter deserves to be remanded back to the concerned Adjudicating Authority.
12. Accordingly, the impugned order is set aside. The Petitioner is granted time till 15th November, 2025, to file the reply to SCN. Upon filing of the reply, the Adjudicating Authority shall issue to the Petitioner, a notice for personal hearing. The personal hearing notice shall be communicated to the Petitioner on the following mobile no. and e-mail address: ● Mobile No.: 9811081159 ● E-mail Address: bhatiav68@gmail.com
13. The reply filed by the Petitioner to the SCN along with the submissions made in the personal hearing proceedings shall be duly considered by the Adjudicating Authority and fresh order with respect to the SCN shall be passed accordingly.
14. 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 Adjudicating 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.
15. The present writ petition is disposed of in above terms. All the pending applications, if any, are also disposed of.
PRATHIBA M. SINGH JUDGE SHAIL JAIN JUDGE SEPTEMBER 26, 2025 Rahul/Sm