Kbs Industriies Limited (Earlier Known As Kbs Industries Limited) vs. The Commissioner Of Delhi Goods And Services Tax & Ors.
Original PDF →Facts
The Petitioner, KBS Industries Limited, filed a writ petition challenging a Show Cause Notice (SCN) dated July 3, 2025, issued by the Delhi GST Department for the Financial Year 2021-2022. The SCN raised a demand of Rs. 26,82,50,383/-. The sole ground of challenge by the Petitioner pertained to a component of the demand related to Input Tax Credit (ITC) claimed from cancelled dealers, return defaulters, and tax non-payers. On a previous hearing, the Department's counsel was to obtain instructions. Today, the Department's counsel submitted that there is an overlap in the demands.
Held
The Court acknowledged the Petitioner's contention regarding the overlap in demands and the Revenue's admission of such overlap. Considering that the Petitioner had already filed a reply to the SCN, the Court directed that the SCN be adjudicated afresh. The adjudication must take into account the admitted overlap. The Court further directed that a personal hearing be afforded to the Petitioner. Following the personal hearing and consideration of submissions, a reasoned order is to be passed, adjudicating the SCN in accordance with the law. Crucially, if an overlap is found, the Department shall consider withdrawing the overlapping part of the demand. The petition was disposed of with these directions.
Key Issues
1. Whether the impugned Show Cause Notice dated 3rd July, 2025, for Financial Year 2021-2022, which raises a demand of Rs. 26,82,50,383/-, suffers from an overlap in the demands raised, specifically concerning Input Tax Credit (ITC) claimed from cancelled dealers, return defaulters, and tax non-payers? Petitioner's Contention: The Petitioner argued that there is an overlap in the demands raised in the impugned SCN, particularly concerning the ITC component. Revenue's Contention: The Revenue, through its counsel, conceded that there is some overlap in the demands.
Sections Cited
Section 73
AI-generated summary — verify with the full judgment below
Cause title — parties, addresses and appearances
O R D E R % 02.12.2025
This hearing has been done through hybrid mode.
The present petition has been filed challenging the impugned Show Cause Notice dated 3rd July, 2025 (hereinafter “the impugned SCN”), in respect of Financial Year 2021-2022, passed by the Delhi GST Department. Vide the said impugned SCN a demand of Rs. 26,82,50,383/- has been raised against the Petitioner.
The only ground of challenge raised by the Petitioner is in respect of one component of the impugned SCN relating to the Input Tax Credit (hereinafter “'ITC”) claimed from cancelled dealers, return defaulters & tax non-payers.
On the last date of hearing i.e., 18th September, 2025, Ms. Urvi Mohan, ld. Counsel for the Department was to obtain instructions. This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 04/12/2025 at 11:54:56
Today, Ms. Urvi Mohan, ld. Counsel has reverted with instructions and submits that there is some overlap in the demands.
Considering the same, since the Petitioner has already filed a reply to the impugned SCN, let the same be adjudicated once again, bearing in mind the overlap which has been raised by the ld. Counsel for the Petitioner.
A personal hearing shall be afforded to the Petitioner on the following: E-Mail: sandeepgupta@vaishlaw.com Mobile Number: 9899006966
After giving the personal hearing and considering the submissions, a reasoned order shall be passed afresh, adjudicating the impugned SCN, in accordance with law bearing in mind the argument relating to overlap. If there is an overlap, the department shall consider withdrawing the overlapping part of the demand.
The Petition along with pending application(s), if any, is disposed of. PRATHIBA M. SINGH, J. RENU BHATNAGAR, J. DECEMBER 2, 2025/tg/msh This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 04/12/2025 at 11:54:56
Reproduced from the public record of the Delhi High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.