M/S Prince Diamond Jewellers Private Limited vs. Goods And Service Tax Officer, Delhi Department Of Trade And Taxes, Government Of Nct Of Delhi & A
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The Petitioner, M/s Prince Diamond Jewellers Private Limited, filed a writ petition challenging an order dated December 14, 2023, passed by the Goods and Service Tax Officer, Delhi. This order raised a demand of Rs. 7,88,611/- due to an alleged excess claim of Input Tax Credit (ITC) based on an analysis of the Petitioner's GST records. The Petitioner claimed they were unaware of the show cause notice (SCN) dated September 24, 2023, and the subsequent order, only learning about them on March 13, 2025, when visiting the Respondent's office for another matter. The Petitioner stated the SCN was uploaded on the Respondent's portal but could not provide a screenshot. The Petitioner also initially challenged certain notifications but later withdrew that challenge.
Held
The Court acknowledged the substantial demand of Rs. 7,88,611/- raised against the Petitioner. While the Petitioner's challenge to certain notifications was not pressed, the Court considered the Petitioner's assertion that they only became aware of the impugned order in March 2025. Given the significant financial implication and the Petitioner's plea of delayed knowledge, the Court was of the opinion that the Petitioner ought to be granted an opportunity to contest the order on its merits. Therefore, the Court did not interfere with the impugned order directly but permitted the Petitioner to file an appeal. The Court stipulated that if the appeal is filed within 30 days from the date of the order, it shall not be dismissed on the grounds of limitation and shall be adjudicated on its merits. The Court did not decide on the validity of the demand itself, leaving that for the appellate authority.
Key Issues
1. Whether the Petitioner was afforded adequate opportunity to present their case, considering their claim of not receiving the show cause notice (SCN) and impugned order in a timely manner? 2. Whether the Petitioner should be permitted to file an appeal against the impugned order, despite potential limitation issues? The Petitioner argued that they were unaware of the SCN and the impugned order until March 13, 2025, and therefore, had no opportunity to file a reply. They contended that the impugned order was passed without proper notice. The Respondent, through their counsel, submitted that an appeal against the impugned order would be barred by limitation as per Section 107(1) of the CGST Act, which prescribes a three-month period for filing appeals, extendable by one month under Section 107(4).
Sections Cited
Section 107, Section 107(1), Section 107(4)
AI-generated summary — verify with the full judgment below
Cause title — parties, addresses and appearances
unsigned Show Cause Notice and impugned order recently when he visited the Office of Respondent No.1 (Ward No.83) on 13.03.2025 in connection with some other matter of the Petitioner.”
The further allegation of the Petitioner is that the SCN was uploaded on the Additional Notices Tab on the Respondent’s Portal. However, the Petitioner is unable to produce any screenshot to demonstrate the same.
Ld. Counsel for the Respondent submits that the Notification Nos. 9/2023-State Tax dated 22nd June, 2023, 56/2023-Central Tax dated 28th December, 2023 and 56/2023 –State Tax dated 11th July, 2024 have also been challenged in the present case, but he does not wish to press the challenge to the said notifications.
Ld. Counsel further submits that he may be permitted to file an appeal challenging the impugned order.
Mr. Batra, on behalf of the Respondent submits that the appeal would be barred by limitation.
As per Section 107(1) of the Central Goods and Service Tax Act, 2017 (hereinafter, ‘CGST Act’), the limitation for filing an appeal is three months, which is extendible by one more month as per Section 107(4) of the CGST Act. The Court has considered the matter. In terms of the impugned order, W.P.(C) 4825/2025 the Petitioner has to pay a demand of Rs.7,88,611/-, including interest and penalty, which is a substantial sum.
On one hand, in terms of Notification 9/2023-State Tax dated 22nd June, 2023, 56/2023-Central Tax dated 28th December, 2023 and 56/2023 –State Tax dated 11th July, 2024, the limitation for passing of the order-in-original by the Adjudicating Authority has been extended. Though the challenge to the said notifications is not being pressed, in this Petition, this Court is of the opinion that considering the nature of the demand, the Petitioner ought to be given an opportunity to assail the order on merits and place its stand.
Under these circumstances, this Court is not inclined to interfere with the impugned order. However, considering the plea that the Petitioner came to know of the impugned order only in March, 2025, the Petitioner is permitted to file an appeal challenging the impugned order, after making the pre-deposit in terms of Section 107 of the CGST Act.
If the appeal is filed within the 30 days period, the same shall be not dismissed on the ground of limitation and shall be adjudicated on the merits.
Petition is disposed of in these terms. All pending applications, if any, are also disposed of. PRATHIBA M. SINGH JUDGE RAJNEESH KUMAR GUPTA JUDGE APRIL 17, 2025 Rahul/ck
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.