Writ Rejected; Taxpayer Directed to Appeal u/s 107 CGST Act Despite Natural Justice Claim

HC held the writ petition not maintainable in view of the efficacious alternative remedy of appeal under Section 107 of the CGST Act. The plea of violation of natural justice, based on non-visibility of the SCN and order in the "additional notices" tab, was found not bona fide, given the petitioner's business status, regular GST compliance, lack of explanation for delayed challenge, non-filing of reply and non-attendance of personal hearing. Nonetheless, recognizing that the petitioner had not yet contested the demand on merits, HC relegated the petitioner to the statutory appellate remedy, granting liberty to file an appeal with requisite pre-deposit.

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1. ISSUES PRESENTED AND CONSIDERED

1.1 Whether the Court ought to decide the challenge to specified GST Notifications issued under Section 168A of the Central Goods and Services Tax Act, 2017, when similar challenges and related questions are already pending before the Supreme Court.

1.2 Whether the ex parte adjudication order and demand, allegedly arising from non-access of the show cause notice and order uploaded in the "additional notices" tab on the GST portal, warrant interference in writ jurisdiction or whether the petitioner should be relegated to the statutory appellate remedy.

1.3 Whether, in the facts of the case, time for filing an appeal under Section 107 of the Central Goods and Services Tax Act, 2017, can be extended and the appeal directed to be entertained on merits without being treated as barred by limitation.

2. ISSUE-WISE DETAILED ANALYSIS

Issue 1: Challenge to GST Notifications under Section 168A CGST Act while similar issues are pending before the Supreme Court

Legal framework (as discussed)

2.1 The Court noted earlier proceedings in a batch of writ petitions where Notifications No. 09/2023-Central Tax, 09/2023-State Tax, 56/2023-Central Tax and 56/2023-State Tax were challenged, with a lead matter in which the validity of the notifications, and compliance with Section 168A of the Central Goods and Services Tax Act, 2017, were extensively argued.

2.2 It was noted that different High Courts have taken divergent views on Notifications 09/2023 and 56/2023, and that the Supreme Court is seized of the matter in a pending special leave petition where the core issue includes whether time limits for adjudication under Section 73 of the GST Acts could have been extended by invoking Section 168A.

Interpretation and reasoning

2.3 The Court recorded that: (a) multiple High Courts have already given differing views on the impugned notifications; (b) the Supreme Court has issued notice and is considering the validity and scope of Section 168A and the impugned notifications; and (c) another High Court (Punjab and Haryana High Court) has, in view of judicial discipline, declined to pronounce on the vires of Section 168A and the notifications, instead directing that its cases be governed by the Supreme Court's eventual decision.

2.4 The Court noted that in its earlier order in the lead Delhi batch, it had already taken a similar approach, recognising that the issue concerning validity of the notifications is squarely before the Supreme Court and that any decision of this Court must remain subject to that outcome.

2.5 The Court therefore treated the petitioner's challenge to the notifications as covered by the same approach adopted in the earlier batch matters, namely that the challenge would abide by and be subject to the decision of the Supreme Court in the pending special leave petition, and by the decision of this Court in the retained batch concerning parallel State notifications.

Conclusions

2.6 The Court did not adjudicate on the validity or vires of the impugned GST notifications in the present writ petition.

2.7 It was held that the petitioner's challenge to the impugned notifications shall be subject to the outcome of the Supreme Court's decision in the pending special leave petition concerning similar notifications, and to the decision of this Court in the identified lead matter relating to parallel State notifications.

Issue 2: Interference with ex parte adjudication order versus relegation to appellate remedy

Interpretation and reasoning

2.8 On facts, the petitioner claimed that both the show cause notice and the impugned order were uploaded in the "additional notices" tab on the GST portal, and for that reason they could not be accessed in time.

2.9 The Court noted that the impugned order was passed on 23 December 2023, and found that the writ petition did not furnish any explanation for the substantial delay in challenging either the show cause notice or the order.

2.10 The Court observed that there was no explanation as to why no reply was filed to the show cause notice and why the petitioner did not attend the personal hearing.

2.11 The Court further recorded that the tax demand raised was substantial and that, considering the petitioner was a business concern regularly filing GST returns, the plea that the documents were only in the "additional notices" tab was not a bona fide ground justifying non-participation in the adjudication.

2.12 At the same time, the Court took into account that the petitioner had not had any opportunity to contest the case on merits before the adjudicating authority, as the order was passed ex parte.

2.13 Balancing these considerations, the Court followed its approach in similar cases where, without deciding the merits of the assessment or the validity of the notifications, parties were allowed to pursue statutory remedies so that the issues could be adjudicated upon merits before the competent authority.

Conclusions

2.14 The Court declined to set aside the impugned adjudication order in writ jurisdiction on the grounds urged, and instead relegated the petitioner to avail of the statutory appellate remedy.

2.15 The writ petition, insofar as it sought direct interference with the impugned assessment order and demand, was disposed of with liberty to pursue appeal under Section 107 of the Central Goods and Services Tax Act, 2017.

Issue 3: Extension of time and condonation of delay for appeal under Section 107 CGST Act

Legal framework and precedents (as discussed)

2.16 The Court referred to Section 107 of the Central Goods and Services Tax Act, 2017, which prescribes the limitation period for filing an appeal before the Appellate Authority.

2.17 The Court relied on its own earlier order in another writ petition where, in similar circumstances, it had granted extended time to file an appeal under Section 107 and directed that such appeal should not be dismissed as time-barred if filed within the extended period.

2.18 The Court also noted that the Supreme Court, while disposing of a special leave petition arising from that earlier Delhi High Court order, upheld the liberty granted by the High Court, and further extended the time within which the statutory appeal could be filed, with a direction that the issue of delay be considered keeping in mind that the petitioner had been pursuing remedies before the High Court and Supreme Court.

Interpretation and reasoning

2.19 Applying the same principle, the Court considered it appropriate to grant the petitioner an express window of time to file an appeal, and to direct that if filed within that period and upon making the requisite pre-deposit, the appeal should not be treated as barred by limitation and should be decided on merits.

2.20 This approach was considered justified as a means of ensuring that the petitioner obtains a full opportunity to challenge the ex parte adjudication on merits before the appellate forum, without this Court itself adjudicating disputed facts or the merits of the tax demand.

2.21 The Court also ensured that necessary access to the GST portal would be granted within a fixed period so that the petitioner could download relevant documents required for the purpose of filing the appeal.

Conclusions

2.22 Liberty was granted to the petitioner to file an appeal under Section 107 of the Central Goods and Services Tax Act, 2017, before the Appellate Authority, subject to making the requisite pre-deposit.

2.23 It was directed that access to the GST portal be provided to the petitioner within one week to enable downloading of required documents.

2.24 The Court directed that if the appeal is filed by 31 January 2026 along with the pre-deposit, it shall not be treated as barred by limitation and shall be adjudicated on merits.

2.25 The Court further directed that the decision of the Appellate Authority in such appeal shall be subject to the outcome of the Supreme Court's decision in the pending special leave petition concerning the impugned notifications and the decision of this Court in the identified lead matter regarding parallel State notifications.

2.26 The writ petition and all pending applications were disposed of in these terms.

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