Court’s Decision
The Delhi High Court set aside the GST demand order passed against the petitioner for FY 2018–19, holding that the order was issued without granting an adequate opportunity to respond to the Show Cause Notice (SCN). The Court remanded the matter back to the adjudicating authority, allowing the petitioner time till 31 August 2025 to file a reply, and directed that a personal hearing be granted. It also clarified that the validity of the impugned notifications — the foundation for the SCN — is sub judice before the Supreme Court and thus remains open.
Facts
The petitioner challenged:
- SCN dated 6 December 2023 issued by the Department of Trade & Taxes, GNCTD, for FY 2018–19.
- Demand order dated 30 March 2024 passed by the Sales Tax Officer Class II/AVATO.
- Notification No. 09/2023–Central Tax dated 31 March 2023.
The SCN and reminder notice (20 November 2023) were uploaded only on the “Additional Notices Tab” of the GST portal, allegedly without direct intimation. As a result, the petitioner could not file a reply, and the order was passed ex parte.
The petitioner argued that this was a violation of natural justice and that the notification itself was invalid. The Court noted that similar issues regarding the validity of Notification Nos. 9/2023 and 56/2023 were pending before the Supreme Court in SLP No. 4240/2025 (M/s HCC-SEW-MEIL-AAG JV v. Assistant Commissioner of State Tax & Ors.).
Issues
- Whether the SCN and subsequent demand order issued through the “Additional Notices Tab” without proper communication violate principles of natural justice.
- Whether the impugned Notification No. 09/2023 is valid, especially in light of pending Supreme Court proceedings.
- Whether the matter should be remanded for fresh adjudication pending the apex court’s ruling.
Petitioner’s Arguments
The petitioner submitted that:
- The SCN and reminder notice were never properly communicated, being uploaded only in the “Additional Notices Tab” which was not prominently visible at the time.
- This deprived them of the opportunity to reply or appear for a personal hearing.
- The impugned notification itself was issued without proper GST Council procedure under Section 168A of the CGST Act, rendering it invalid.
- Precedents from the Delhi High Court (e.g., Neelgiri Machinery, Satish Chand Mittal, Anant Wire Industries) supported remanding cases where notices were not properly served.
Respondent’s Arguments
The department argued that:
- The SCN was validly issued and accessible on the GST portal, followed by a reminder notice.
- Since January 2024, changes to the portal made the “Additional Notices Tab” more visible, reducing the scope for such claims.
- A reminder notice dated 26 January 2024 was issued, giving the petitioner another opportunity.
- Mere placement under “Additional Notices” should not invalidate proceedings.
Analysis of the Law
The Court examined:
- Section 168A of the CGST Act — which governs extensions of time limits and requires GST Council recommendation.
- Procedural fairness principles under Article 14 and 19(1)(g) of the Constitution.
- Previous Delhi High Court orders remanding similar matters where notices were not properly served.
The Court noted that the issue of the notification’s validity was already before the Supreme Court, and judicial discipline required leaving that issue open.
Precedent Analysis
The Court relied on:
- M/s ACE Cardiopathy Solutions Pvt. Ltd. v. Union of India — Held that non-intimation of notices violates natural justice.
- Kamla Vohra v. Sales Tax Officer Class II/AVATO — Similar ruling on improper portal communication.
- Satish Chand Mittal v. STO SGST — Directed remand when notices were uploaded under “Additional Notices & Orders” without proper visibility.
- Anant Wire Industries v. STO Class II/AVATO — Remand granted under similar facts.
These precedents reinforced that the remedy for such procedural lapses is to set aside the order and remand the matter for fresh consideration.
Court’s Reasoning
- The Court acknowledged that after 16 January 2024, GST portal changes improved notice visibility, but the petitioner’s SCN was issued before this update.
- Even though a reminder notice was issued in January 2024, the fact remained that no reply was filed and no hearing was granted before the order was passed.
- Given the pendency of the notification validity issue before the Supreme Court, and in the interest of justice, the matter warranted remand.
Conclusion
- Impugned order set aside.
- Petitioner to file reply to SCN by 31 August 2025.
- Adjudicating authority to issue a personal hearing notice via email and mobile and adjudicate afresh.
- Access to GST portal to be provided within one week.
- Notification validity issue kept open, subject to outcome of SLP No. 4240/2025 and related Delhi High Court proceedings.
- All rights and remedies of parties preserved.
Implications
- Reaffirms that notices must be effectively communicated, not merely uploaded in obscure sections of the GST portal.
- Shows judicial reluctance to decide notification validity when already pending before the Supreme Court.
- Sets procedural safeguards — hearing notices must be emailed and sent via mobile communication.
- Highlights importance of natural justice even in tax enforcement.
Referred Cases and Their Relevance
- M/s ACE Cardiopathy Solutions Pvt. Ltd. — Procedural fairness in GST adjudication.
- Kamla Vohra — Validity of service through portal tabs.
- Satish Chand Mittal — Notice visibility on GST portal.
- Anant Wire Industries — Remand for lack of proper notice.
- SLP No. 4240/2025 — Pending Supreme Court case on notification validity.
FAQs
Q1: What happens if GST notices are uploaded only under “Additional Notices” without proper intimation?
Such practice can be challenged as violating natural justice. Courts have remanded cases for fresh hearing in similar situations.
Q2: Is Notification No. 09/2023 declared invalid in this case?
No. The Delhi High Court left the validity issue open as it is pending before the Supreme Court.
Q3: What is the remedy if an ex parte GST order is passed without a hearing?
You can approach the High Court, which may set aside the order and remand the matter, directing proper service of notices and a fresh hearing.
