M/S N.K. Kapur And Company Private Limited vs. The Union Of INDIA & Anr.
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The Petitioner, M/s N.K. Kapur and Company Private Limited, filed a writ petition challenging a demand order dated August 30, 2024, passed by the Sales Tax Officer Class II/AVATO, Ward 4, Zone 1, Delhi. The demand was raised based on a Show Cause Notice dated May 8, 2024, alleging excess claim of Input Tax Credit (ITC), under-declaration of ineligible ITC, and ITC claimed from cancelled dealers, return defaulters, and tax non-payers. The Petitioner had filed a reply to the SCN on June 7, 2024. The Petitioner contended that no personal hearing was granted before the impugned order was passed. The demand pertains to the financial year 2019-20. The Petitioner also challenged certain notifications related to GST. The Court noted that the challenge to the impugned order was belated, having been filed more than a year after its passing.
Held
The Court held that there was an infraction of the principles of natural justice as a personal hearing was not granted to the Petitioner before the impugned order was passed. Despite noting that the challenge to the impugned order was belated, the Court was inclined to grant an opportunity to the Petitioner to file an appeal. The Court directed that the Petitioner may avail of the appellate remedy by December 15, 2025, along with the requisite pre-deposit. If the appeal is filed by this date, it shall be adjudicated on merits and shall not be dismissed on the ground of limitation. The Court also directed that access to the GST Portal shall be provided within one week to enable the Petitioner to access notices and related documents. All rights and remedies of the parties were left open. The issue regarding the validity of the challenged notifications, which is pending before the Supreme Court and this Court, was not decided in this order.
Key Issues
1. Whether the impugned demand order dated August 30, 2024, passed by the Sales Tax Officer Class II/AVATO, Ward 4, Zone 1, Delhi, is liable to be quashed on the ground of violation of principles of natural justice, specifically the non-grant of a personal hearing to the Petitioner? (Question of law) 2. Whether the Petitioner should be permitted to avail the appellate remedy despite the delay in filing the challenge to the impugned order? Petitioner's arguments: The Petitioner argued that the demand order was passed without affording an opportunity for a personal hearing, thus violating the principles of natural justice. They also challenged the validity of certain notifications, the challenge to which is pending before higher courts. The Petitioner sought to quash the demand order. Revenue's arguments: The judgment does not record any specific arguments made by the Revenue or the State. However, the Revenue issued the impugned order and the SCN.
Sections Cited
Section 73, Section 129
AI-generated summary — verify with the full judgment below
Cause title — parties, addresses and appearances
O R D E R % 18.11.2025
This hearing has been done through hybrid mode. CM APPL. 69173/2025
Allowed, subject to all just exceptions. The application is disposed of. W.P.(C) 16829/2025 & CM APPL. 72253/2025
The present petition has been filed under Articles 226 and 227 of the Constitution of India, inter alia, seeking quashing of the impugned demand order dated 30th August, 2024 (hereinafter, ‘impugned order’) passed by the Sales Tax Officer Class II/AVATO, Ward 4, Zone 1, Delhi.
The case of the Petitioner is that the demand has been raised without affording any opportunity for personal hearing. The present case arises out of the Show Cause Notice (hereinafter, ‘SCN’) dated 8th May, 2024, wherein, the Department sought to raise various demands under the following heads: 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 20/11/2025 at 12:16:32
(i) Excess claim of Input Tax Credit (hereinafter, ‘ITC’) (ii) Under declaration of Ineligible ITC. (iii)ITC claimed from cancelled dealers, return defaulters & tax non- payers.
The Petitioner had filed a reply to the SCN on 7th June, 2024 giving various details and thereafter, the impugned order had been passed. The case of the Petitioner is that personal hearing was not granted to the Petitioner. However, this Court notices that the impugned order was passed way back on 30th August, 2024, which is sought to be challenged more than a year later.
Ld. Counsel for the Petitioner submits that the demand relates to the financial year 2019-20 and grounds have been raised in the present writ petition to challenge to the following notifications: ●Notification No. 9/2023- Central Tax dated 31st March, 2023; ●Notification No. 56/2023- Central Tax dated 28th December, 2023; ●Notification No. 09/2023-State Tax dated 22nd June, 2023 and ●Notification No. 56/2023- State Tax dated 11th July, 2024
It is a matter of judicial record that the challenge to these notifications is pending before the Supreme Court in S.L.P No 4240/2025 titled M/s HCC- SEW-MEIL-AAG JV v. Assistant Commissioner of State Tax & Ors as also this Court in W.P.(C) 9214/2024 titled Engineers India Limited v. Union of India & Ors.
Under such circumstances, though the challenge to the impugned order is belated, the Court is inclined to grant an opportunity to the Petitioner to file an appeal as there is an infraction of principles of natural justice as hearing has not been granted.
The writ petition along with pending application, is disposed of with the 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 20/11/2025 at 12:16:32
direction that the Petitioner may avail of the appellate remedy by 15th December, 2025 along with the requisite pre-deposit. 10 If the appeal is filed by 15th December, 2025, the same shall be adjudicated on merits and shall not be dismissed on the ground of limitation.
All rights and remedies of the parties are left open. Access to the GST Portal, shall be provided within one week, to the Petitioner to enable access to the notices and related documents. PRATHIBA M. SINGH, J. SHAIL JAIN, J. NOVEMBER 18, 2025 kk/ck 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 20/11/2025 at 12:16:32
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.