Holy Land Marketing Private Limited vs. Sales Tax Officer Class Ii/Avato Ward 205 Zone 11, Delhi & Ors.

Held

The Court held that the impugned order dated August 31, 2024, is not tenable and deserves to be set aside due to a lack of reasoning, non-consideration of the Petitioner's reply, and a non-application of mind. The Court noted that the order was passed in a "completely cryptic and templated manner" and that none of the contentions raised by the Petitioner in response to the Show Cause Notice were adverted to. The Court referenced previous judgments of this Court and Coordinate Benches that had quashed similar orders passed by the same officer using identical language. Consequently, the impugned order was quashed, and the matter was remanded for fresh consideration of the Show Cause Notice and the Petitioner's replies. The Court directed that the matter be marked to a different Proper Officer who shall adjudicate the Show Cause Notice on merits within two months, affording the Petitioner one hearing. The challenge to the Notifications was expressly kept open to be raised afresh if the need arises.

Facts

The Petitioner, Holy Land Marketing Private Limited, challenged an order dated August 31, 2024, passed by the Sales Tax Officer, Class-II, Ward 202, 203 and 205, Zone-11, Delhi. This order arose from a Show Cause Notice dated May 15, 2024, which alleged under-declaration of output tax liability in the Petitioner's annual returns (GSTR-09) for the financial year 2019-20, proposing a demand of Rs. 46,49,420/-. The Petitioner submitted detailed replies on June 14, 2024, and August 13, 2024. The petition also challenged Notifications No. 56/2023-Central Tax dated December 28, 2023, and 56/2023-State Tax dated September 11, 2024, as ultra vires Section 168-A of the CGST Act, 2017, read with the Delhi GST Act, 2017. The High Court noted the impugned order was passed in a cryptic and templated manner.

Key Issues

1. Whether the impugned order dated August 31, 2024, passed by the Sales Tax Officer is sustainable in law, considering it allegedly lacks reasoning and fails to address the contentions raised by the Petitioner in response to the Show Cause Notice, thereby violating principles of natural justice and the requirement for reasoned orders under GST law, specifically concerning the determination of tax liability under Section 73 of the CGST Act, 2017? Petitioner's arguments: The impugned order is cryptic, templated, and demonstrates a complete non-application of mind. It fails to advert to or consider the Petitioner's detailed replies and grounds submitted against the Show Cause Notice. The language used in the order is identical to previous orders of the same officer that have been set aside by this Court and other Coordinate Benches, indicating a pattern of passing unreasoned orders. Revenue's arguments: Not recorded in the judgment.