Delhi HC Directs Fresh Speaking Order in GST ITC Dispute

The Delhi High Court has quashed a GST adjudication order passed against M/s Delhi MSW Solutions Limited after holding that the authorities failed to consider the detailed reply filed by the assessee in response to the show cause notice. A Division Bench comprising Justice Nitin Wasudeo Sambre and Justice Ajay Digpaul observed that an order passed without dealing with the taxpayer’s submissions violates principles of natural justice and constitutional protections under Article 14. The Court pointed out that:

“As the order impugned does not contain the reasons for disallowing the claims put forth by the petitioner in the reply to the show cause notice, the same must be held as a non-speaking order passed without considering the reply of the petitioner.”

The petitioner had filed a writ petition challenging the adjudication order dated 29.12.2025 concerning alleged illegal availment of Input Tax Credit (ITC). It was argued that a detailed issue-wise reply in FORM GST DRC-06 dated 17.08.2025 had already been submitted before the authorities in response to the show cause notice dated 18.07.2025.

Before the Court, the petitioner contended that despite the reply forming part of the official record, the impugned order failed to address any of the explanations or legal submissions raised therein. The petitioner argued that the order merely rejected the claims without assigning proper reasons or referring to the applicable statutory provisions.

The High Court observed that once the reply was available on record, the authorities were expected to examine the contentions raised by the petitioner and pass a reasoned order dealing with each objection in accordance with law.

“Such order goes contrary to the constitutional protections provided under Article 14.”

Holding the impugned order to be a non-speaking order, the Court quashed and set aside the adjudication order dated 29.12.2025. The Bench permitted the petitioner to appear before the authorities on 22.06.2026 along with any additional reply to the original show cause notice.

The Court further directed the respondents to pass a fresh speaking order after considering both the earlier and additional replies, if any, and communicate the same to the petitioner within eight weeks thereafter.

To Read Full Judgment, Download PDF Given Below.