M/S. Dhupani Overseas vs. The Principal Commissioner. Delhi GST. & Anr.
Original PDF →Facts
The Petitioner, M/s. Dhupani Overseas, filed a writ petition challenging a Show Cause Notice (SCN) dated August 17, 2024, issued by the Sales Tax Officer Class II/AVATO, Ward 45, for the cancellation of its GST registration. The SCN cited "Rule 21(e) - person avails ITC in violation of the provisions of section 16 of the Act or the rules made thereunder" as the reason. The Petitioner argued that the SCN lacked particulars and was replied to on August 29, 2024, with a general statement requesting a visit and restart of GST. The Respondents contended that the Petitioner had availed Input Tax Credit (ITC) of Rs. 52,35,000/- and provided no reply to this specific allegation. The Court noted that while the SCN was sketchy, the Petitioner's reply was also lacking.
Held
The Court held that while the Show Cause Notice (SCN) was indeed bereft of particulars, the Petitioner's reply was equally sketchy. The Court noted that the Petitioner had not taken any further steps beyond filing a general reply and making representations. The Court also acknowledged the Respondent's submission that the Petitioner had availed Input Tax Credit (ITC) of Rs. 52,35,000/- and had not provided a reply to this specific point, which was mentioned in the SCN. Consequently, the Court directed the Department to issue supplemental reasons in support of the impugned SCN to the Petitioner by January 5, 2026. The Petitioner was then required to furnish a reply to the SCN, along with the supplemental reasons, by February 15, 2026, and to file all relevant documents to justify its existence and the availing of ITC. The Petitioner would be given a personal hearing. Access to the GST portal would be provided for uploading documents. The SCN would be adjudicated on merits thereafter. The Court explicitly stated that it had not gone into the merits of the matter, leaving all rights and contentions open.
Key Issues
1. Whether the Show Cause Notice dated August 17, 2024, issued by the Sales Tax Officer Class II/AVATO, Ward 45, for cancellation of GST registration is liable to be quashed for lack of particulars, as argued by the Petitioner, relying on the precedent in M/S My Trading Overseas vs Commissioner Delhi Goods and Service Tax? 2. Whether the Petitioner's reply dated August 29, 2024, adequately addresses the reasons for the proposed cancellation of GST registration, particularly concerning the alleged availment of Input Tax Credit (ITC) in violation of Section 16 of the Act, as contended by the Respondents? Petitioner's Arguments: The Petitioner argued that the impugned SCN was bereft of any particulars, mirroring the situation in the 'My Trading Overseas' case, and thus should be quashed. The Petitioner also stated that no GST officer had visited or informed them, and they were conducting business at their registered address. Respondents' Arguments: The Respondents argued that the present case was distinguishable from 'My Trading Overseas'. They further submitted that the Petitioner had availed ITC of Rs. 52,35,000/- and had provided no reply to this specific allegation, which was mentioned in the SCN.
Sections Cited
Rule 21(e), Section 16
AI-generated summary — verify with the full judgment below
Cause title — parties, addresses and appearances
O R D E R % 01.12.2025
This hearing has been done through hybrid mode.
The present petition has been filed by the Petitioner under Article 226 of the Constitution of India, inter alia, assailing the Show Cause Notice dated 17th August, 2024 issued by the Sales Tax Officer Class II/AVATO, Ward 45 (hereinafter, ‘impugned SCN’).
Vide the impugned SCN, the reasons given for cancellation of Petitioner’s GST registration are stated as under: “[...] Whereas on the basis of information which has come to my notice, it appears that your registration is liable to be cancelled for the following reasons:
Rule 21(e)-person avails ITC in violation of the provisions 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 03/12/2025 at 12:12:02 of section 16 of the Act or the rules made thereunder ”
The grievance of ld. Counsel for the Petitioner is that there are no reasons given in the impugned SCN, though, the same has been replied to by the Petitioner on 29th August, 2024 to following effect: “ [...] Response to the Show Cause Notice Issued for Cancellation of Registration: Respected sir, My name is JALARAM Prop of DHUPANI OVERSEAS. As I have received a show cause notice from you. The SCN number is - ZA0708240755860. In this I want to say that no GST officer has come to me and I have not been informed by phone either. I am running all my work on the address I have in GST. I request you to visit again and restart my GST.”
Mr. Shivender Kr. Sharma, ld. Counsel for the Petitioner has relied upon the decision of this Court in ‘W.P.(C) 15317/2023 titled M/S My Trading Overseas vs Commissioner Delhi Goods and Service Tax’, where the SCN was bereft of any particulars and the Court had quashed the same.
Ms. Urvi Mohan, ld. Counsel for Respondents submits that the present case is distinguishable from My Trading Overseas (Supra).
The Court has considered the matter. A perusal of the Petitioner’s reply would show that while the impugned SCN is bereft of any particulars, the reply is equally sketchy.
The impugned SCN was issued way back in August 2024. Apart from filing a sketchy reply and representations to the GST department, there is no other step that has been taken by the ld. Counsel for the Petitioner. 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 03/12/2025 at 12:12:02 9. In the opinion of this Court, had the Petitioner been genuinely conducting business, a proper reply would have been filed and proper follow up would have been undertaken. However, the same is lacking in the present petition.
Needless to add, the SCN which is issued by the Department ought to have something more than what is extracted above. Mere mention of the rules and sections would not be sufficient.
At this stage, ld. Counsel for the Respondent submits that that Rs. 52,35,000/- has been availed of as Input Tax Credit (hereinafter, ‘ITC’) and no reply thereof is forthcoming from the Petitioner. 12 Additionally, ld. Counsel for the Petitioner has not given any reply to the availment of ITC, which is specifically mentioned in the reasons to the impugned SCN.
Under such circumstances, let the Department issue supplemental reasons in support of the impugned SCN to the Petitioner by 5th January, 2026. 14. Further, the reply to the impugned SCN along with the supplemental reasons supplied, shall be furnished by the ld. Counsel for the Petitioner by 15th February, 2026. 15. The Petitioner shall be given a personal hearing notice on the following: Email ID: skslawchambers@hotmail.com Mobile Number: 9873240045
The ld. Counsel for the Petitioner shall file all the relevant documents along with the reply to the impugned SCN to justify both its existence as also the availing of the Input Tax Credit. 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 03/12/2025 at 12:12:02 17. Access to the GST Portal, shall be provided within one week, to the Petitioner to enable uploading of any related documents.
After considering all the documents and submissions, the SCN shall be adjudicated on merits.
Needless to add this Court has not gone into the merits of the matter. All rights and contentions are left open.
The petition is disposed of in these terms. All pending applications, if any, are also disposed of. PRATHIBA M. SINGH, J. RENU BHATNAGAR, J. DECEMBER 1, 2025/tg/sm 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 03/12/2025 at 12:12:02
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.