Delhi HC Quashes GST Order for Ignoring Taxpayer’s Detailed Reply, Calls It Non-Speaking and Violative of Article 14:

The Delhi High Court on 11 May set aside a GST adjudication order against M/s Delhi MSW Solutions Limited after finding that the tax authorities failed to consider the detailed reply filed by the taxpayer in response to the show cause notice. A Division Bench comprising Justice Nitin Wasudeo Sambre and Justice Ajay Digpaul held that the impugned order was a non-speaking order and violative of Article 14 of the Constitution.

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 challenged the order dated 29.12.2025 passed by the State Tax authorities in relation to alleged illegal availment of Input Tax Credit (ITC). The petitioner contended that a detailed issue wise reply in FORM GST DRC-06 had already been submitted on 17.08.2025 responding to four separate allegations raised in the show cause notice dated 18.07.2025.

Before the High Court, it was argued that although the reply was admittedly available on record, the adjudicating authority failed to deal with the explanations furnished by the petitioner and passed the order without assigning any reasons for rejecting the contentions raised.

The Court observed that once a reply forms part of the record, the authorities are duty-bound to examine the objections raised by the taxpayer and pass a reasoned order dealing with the statutory provisions under which such claims are proposed to be disallowed.

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

Holding that the impugned order suffered from complete absence of reasoning, the High Court quashed the order dated 29.12.2025 and remanded the matter back to the authorities for fresh adjudication.

The Bench permitted the petitioner to appear before the department on 22.06.2026 and also granted liberty to file an additional reply, if required. The respondents were directed to pass a fresh speaking order after considering both the earlier and additional replies and communicate the same within eight weeks thereafter.