Delhi High Court Quashes GST Demand of Rs. 14,54,494 for FY 2018-19

A writ petition has been filed challenging the order of 13.04.2024 passed by the Sales Tax Officer for the Financial Year 2018-19, raising a demand of Rs. 14,54,494/-. The petitioner has challenged Notification No. 56/2023-Central Tax of 28.12.2023 and Notification No.56/2023-State Tax. It was submitted that the Show Cause Notice dated 11.12.2023 was uploaded only under the “Additional Notices Tab” on the GST portal. The petitioner contended that no effective opportunity was granted to file a reply, and the impugned order came to be passed in default. The writ petition was listed along with a batch of connected matters where similar issues had arisen and where proceedings were pending before the Hon’ble Supreme Court.

The contention raised was that Show Cause Notices uploaded only in the “Additional Notices Tab” could not be considered valid service and passing an order on such basis was not sustainable. It was urged that the impugned order was liable to be set aside on the ground of violation of principles of natural justice. The Court reviewed the case file, specifically the Show Cause Notice issued on 11.12.2023 and the challenged order passed on 13.04.2024, to determine if the petitioner had been given an opportunity to be heard and due service had been provided before the requisition of Rs. 14,54,494 was confirmed.

Main Issue: Whether the demand of Rs. 14,54,494 for FY 2018-19 could be sustained when the Show Cause Notice dated 11.12.2023 was uploaded under the “Additional Notices Tab” and the impugned order was passed without reply or hearing.

HC’s Decision: The Court observed that the Show Cause Notice dated 11.12.2023 had been uploaded in the “Additional Notices Tab” of the GST portal. The Court ordered that the petitioner could file reply to the Show Cause Notice by 31.10.2025 and the concerned adjudicating authority shall thereafter pass a fresh order. It was categorical that the adjudicating authority shall issue notice of hearing through GST portal and also by email and mobile for strict compliance.

The Court ordered that the authority for adjudication grant access to the GST portal, take into consideration the application and oral arguments of the petitioner and pass a reasoned order after hearing. The Court clarified that the adjudication proceedings would be subject to the outcome of the proceedings pending before the Hon’ble Supreme Court in and before this Court in connected matters. The writ petition was accordingly disposed of with the above directions and pending applications were also disposed of.

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