Delhi HC Sets Aside Ex-Parte GST Demand; Remands Matter Amid Pending SC Challenge

M/s Gupta Sanitation challenged an ex-parte adjudication order dated 18.04.2024 and the show cause notice dated 04.12.2023 for the period April 2018 to March 2019. The petitioner also questioned the validity of Notification No. 56/2023–Central Tax extending the limitation under Section 168A of the CGST Act, an issue already pending before the Supreme Court.

The petitioner contended he had not filed a reply or appeared for a personal hearing, as the notices were uploaded only under the “Additional Notices” tab on the GST portal and were not effectively communicated.

Main Issue: Whether the ex-parte GST adjudication order deserved to be set aside and remanded for fresh consideration, pending final adjudication by the Supreme Court on the validity of Notification No. 56/2023–Central Tax.

HC’s Ruling: The High Court set aside the impugned adjudication order and remanded the matter to the adjudicating authority. The Court held that the petitioner had not been afforded a proper opportunity to file a reply or be heard, and principles of natural justice required that such an opportunity be granted, especially when the challenge to the impugned notification was still pending before the Supreme Court.

The remand was made subject to payment of costs of Rs. 10,000 to the Delhi High Court Staff Welfare Fund. The petitioner was granted time until 15.01.2026 to file a reply to the show cause notice. The adjudicating authority was directed to grant a personal hearing and thereafter pass a fresh, reasoned order. The Court held that all issues were left open and any fresh order would be subject to the outcome of the pending Supreme Court proceedings.

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