Facts of the Case

The petitioner, Eltus Mode Private Limited, filed a writ petition under Articles 226 and 227 of the Constitution challenging the adjudication order dated 01.08.2024 passed by the Assistant Commissioner, Ward-201, Zone-11, DGST, for Financial Year 2019–20. The petitioner also challenged the Show Cause Notice dated 27.05.2024 and the constitutional validity of Notification No. 9/2023 (Central Tax), Notification No. 9/2023 (State Tax), Notification No. 56/2023 (Central Tax) and Notification No. 56/2023 (State Tax), all issued under Section 168A of the CGST Act extending limitation for adjudication.

The Show Cause Notice dated 27.05.2024 was followed by a reminder dated 05.07.2024, and a personal hearing was fixed on 10.07.2024. However, the petitioner neither filed a reply to the Show Cause Notice nor attended the personal hearing. Consequently, the adjudicating authority passed the impugned order ex parte, raising tax demand along with interest and penalty.

The petitioner contended that the Show Cause Notice was uploaded only on the GST portal and no separate communication was sent to the registered email or address, resulting in the notice being missed. The petitioner submitted that tax had already been paid and the lapse pertained mainly to non-filing of annual return, and sought an opportunity to file a reply and contest the matter on merits.

Issues Involved

Whether the ex parte adjudication order passed without the petitioner filing a reply or being effectively heard violated principles of natural justice, whether the matter deserved remand for fresh adjudication, and whether the challenge to limitation-extension notifications under Section 168A should be kept open pending adjudication by the Supreme Court.

Petitioner’s Arguments

The petitioner argued that it was deprived of an effective opportunity to respond to the Show Cause Notice as no direct communication was received and the notice was missed on the GST portal. It was contended that the impugned order was passed without hearing and deserved to be set aside. The petitioner expressed willingness to file a reply, participate in personal hearing, and comply with procedural requirements.

Respondent’s Arguments

The Revenue submitted that the Show Cause Notice, reminder and personal hearing notice were duly issued on the GST portal. It was argued that sufficient opportunities were granted but not availed by the petitioner. The Department also pointed out that the validity of the impugned limitation-extension notifications was pending consideration before the Supreme Court in SLP No. 4240/2025.

Court Order / Findings

The Delhi High Court observed that the challenge to the impugned notifications issued under Section 168A of the CGST Act was pending before the Supreme Court and that various High Courts had adopted differing approaches. The Court held that all such matters would ultimately be governed by the decision of the Supreme Court.

On facts, the Court noted that no reply had been filed by the petitioner to the Show Cause Notice and the adjudication order was passed ex parte. Relying on its earlier decision in Sugandha Enterprises vs. Commissioner, DGST, the Court held that an opportunity ought to be afforded to the petitioner to contest the matter on merits. Accordingly, the impugned adjudication order dated 01.08.2024 was set aside and the matter was remanded to the adjudicating authority.

The Court imposed a cost of ₹20,000 to be deposited with the Delhi High Court Bar Clerks Association as a condition for remand and directed restoration of access to the GST portal to enable the petitioner to file its reply.

Important Clarification

The High Court clarified that the remand was granted solely to afford an opportunity of hearing to the petitioner. The issue regarding the validity of the impugned limitation-extension notifications under Section 168A was expressly left open and made subject to the final decision of the Supreme Court in SLP No. 4240/2025 and the Delhi High Court in connected matters.

Final Outcome

The writ petition was disposed of. The impugned adjudication order dated 01.08.2024 was set aside. The petitioner was granted time till 31.01.2026 to file a reply to the Show Cause Notice dated 27.05.2024. Upon filing of the reply, the adjudicating authority was directed to grant personal hearing, consider the submissions, and pass a fresh reasoned order in accordance with law. The relief was made subject to payment of ₹20,000 as cost, and all proceedings were directed to remain subject to the outcome of pending proceedings before the Supreme Court and the Delhi High Court on the validity of the impugned notifications.

Source Link- https://delhihighcourt.nic.in/app/showFileJudgment/75419122025CW193022025_175314.pdf

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