Anmol Purse And Wallet Through Its Proprietor Harichand vs. Govt Of Nct Of Delhi Through Chief Secretary & Ors. - Delhi High Court, 07 May 2025

Heard together (2 matters)

W.P.(C) 807/2025

W.P.(C) 16499/2023

Read from the judgment's own cause title. This page is filed under one of them.

Cause title — parties, addresses and appearances

W.P.(C) 807/2025 Page 1 of 9 $~96 * IN THE HIGH COURT OF DELHI AT NEW DELHI Date of Decision: 7th May, 2025 + W.P.(C) 807/2025 & CM APPL. 3978/2025 ANMOL PURSE AND WALLET THROUGH ITS PROPRIETOR HARICHAND .....Petitioner Through: Mr. M.A. Ansari and Ms. Tabbasusum Firdaus, Advocates.Adv. (M: 9718503000), email- ansariadvocate15@gmail.com versus GOVT OF NCT OF DELHI THROUGH CHIEF SECRETARY & ORS. .....Respondents Through: Mr. Abdhesh Chaudhary, CHSC & Ms. Geetanjali, Advocates. Mr. KG Gopalakrishnan, Ms. Nisha Mohandas and Mr. Kunwar Raj Singh, Advocates for R/GNCTD. CORAM: JUSTICE PRATHIBA M. SINGH JUSTICE RAJNEESH KUMAR GUPTA Prathiba M. Singh, J. (Oral) 1. This hearing has been done through hybrid mode. 2. The present petition has been filed by the Petitioner– Anmol Purse and Wallet under Article 226 of the Constitution of India, inter alia, challenging the Show Cause Notice dated 20th May, 2024 (hereinafter, the ‘Show Cause Notice’) issued by the office of Sales Tax Officer Class II/ AVATO, Delhi (hereinafter, the ‘Sales Tax Officer’) as also the consequent order dated 30th August, 2024 passed by the Sales Tax Officer. 3. The petition also challenges the vires of Notification No. 56/2023- Central Tax dated 28th December, 2023 and Notification No. 56/2023-State Tax dated 11th July, 2024 (hereinafter, the ‘impugned notifications’). 4. The validity of the impugned notifications was under consideration Signed By:NAMITA DHYANI Signing Date:17.05.2025 14:49:05 Signature Not Verified W.P.(C) 807/2025 Page 2 of 9 before this Court in a batch of petitions with the lead petition being W.P.(C) 16499/2023 titled ‘DJST Traders Pvt. Ltd. vs. Union of India and Ors.’ In the said batch of petitions, on 22nd April, 2025, the parties were heard at length qua the validity of the impugned notifications and accordingly, the following order was passed: “4. Submissions have been heard in part. The broad challenge to both sets of Notifications is on the ground that the proper procedure was not followed prior to the issuance of the same. In terms of Section 168A, prior recommendation of the GST Council is essential for extending deadlines. In respect of Notification no.9, the recommendation was made prior to the issuance of the same. However, insofar as Notification No. 56/2023 (Central Tax) the challenge is that the extension was granted contrary to the mandate under Section 168A of the Central Goods and Services Tax Act, 2017 and ratification was given subsequent to the issuance of the notification. The notification incorrectly states that it was on the recommendation of the GST Council. Insofar as the Notification No. 56 of 2023 (State Tax) is concerned, the challenge is to the effect that the same was issued on 11th July, 2024 after the expiry of the limitation in terms of the Notification No.13 of 2022 (State Tax). 5. In fact, Notification Nos. 09 and 56 of 2023 (Central Tax) were challenged before various other High Courts. The Allahabad Court has upheld the validity of Notification no.9. The Patna High Court has upheld the validity of Notification no.56. Whereas, the Guwahati High Court has quashed Notification No. 56 of 2023 (Central Tax). 6. The Telangana High Court while not delving Signed By:NAMITA DHYANI Signing Date:17.05.2025 14:49:05 Signature Not Verified W.P.(C) 807/2025 Page 3 of 9 into the vires of the assailed notifications, made certain observations in respect of invalidity of Notification No. 56 of 2023 (Central Tax). This judgment of the Telangana High Court is now presently under consideration by 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. The Supreme Court vide order dated 21st February, 2025, passed the following order in the said case: “1. The subject matter of challenge before the High Court was to the legality, validity and propriety of the Notification No.13/2022 dated 5-7-2022 & Notification Nos.9 and 56 of 2023 dated 31-3-2023 & 8-12-2023 respectively. 2. However, in the present petition, we are concerned with Notification Nos.9 & 56/2023 dated 31-3-2023 respectively. 3. These Notifications have been issued in the purported exercise of power under Section 168 (A) of the Central Goods and Services Tax Act. 2017 (for short, the "GST Act"). 4. We have heard Dr. S. Muralidhar, the learned Senior counsel appearing for the petitioner. 5. The issue that falls for the consideration of this Court is whether the time limit for adjudication of show cause notice and passing order under Section 73 of the GST Act and SGST Act (Telangana GST Act) for financial year 2019-2020 could have been extended by issuing the Notifications in question under Section 168- A of the GST Act. 6. There are many other issues also arising for consideration in this matter. Signed By:NAMITA DHYANI Signing Date:17.05.2025 14:49:05 Signature Not Verified W.P.(C) 807/2025 Page 4 of 9 7. Dr. Muralidhar pointed out that there is a cleavage of opinion amongst different High Courts of the country. 8. Issue notice on the SLP as also on the prayer for interim relief, returnable on 7-3-2025.” 7. In the meantime, the challenges were also pending before the Bombay High Court and the Punjab and Haryana High Court . In the Punjab and Haryana High Court vide order dated 12th March, 2025, all the writ petitions have been disposed of in terms of the interim orders passed therein. The operative portion of the said order reads as under: “65. Almost all the issues, which have been raised before us in these present connected cases and have been noticed hereinabove, are the subject matter of the Hon'ble Supreme Court in the aforesaid SLP. 66. Keeping in view the judicial discipline, we refrain from giving our opinion with respect to the vires of Section 168-A of the Act as well as the notifications issued in purported exercise of power under Section 168-A of the Act which have been challenged, and we direct that all these present connected cases shall be governed by the judgment passed by the Hon'ble Supreme Court and the decision thereto shall be binding on these cases too. 67. Since the matter is pending before the

Hon'ble Supreme Court, the interim order passed in the present cases, would continue to operate and would be governed by the final adjudication by the Supreme Court on the issues in the aforesaid SLP-4240-2025. W.P.(C) 807/2025 68. In view of the aforesaid, all these connected cases are disposed of accordingly along with pending applications, if any.”

The Court has heard ld. Counsels for the parties for a substantial period today. A perusal of the above would show that various High Courts have taken a view and the matter is squarely now pending before the Supreme Court.

Apart from the challenge to the notifications itself, various counsels submit that even if the same are upheld, they would still pray for relief for the parties as the Petitioners have been unable to file replies due to several reasons and were unable to avail of personal hearings in most cases. In effect therefore in most cases the adjudication orders are passed ex-parte. Huge demands have been raised and even penalties have been imposed.

10.

Broadly, there are six categories of cases which are pending before this Court. While the issue concerning the validity of the impugned notifications is presently under consideration before the Supreme Court, this Court is of the prima facie view that, depending upon the categories of petitions, orders can be passed affording an opportunity to the Petitioners to place their stand before the adjudicating authority. In some cases, proceedings including appellate remedies may be permitted to be pursued by the Petitioners, without delving into the question of the validity of the said notifications at this stage.

11.

The said categories and proposed reliefs have been broadly put to the parties today. They may seek instructions and revert by tomorrow i.e., 23rd April, 2025.” W.P.(C) 807/2025 5. Thereafter, on 23rd April, 2025, this Court, having noted that the validity of the impugned notifications is under consideration before the Supreme Court, had disposed of several matters in the said batch of petitions after addressing other factual issues raised in the respective petitions. Additionally, while disposing of the said petitions, this Court clearly observed that the validity of the impugned notifications therein shall be subject to the outcome of the proceedings 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.

However, in cases where the challenge is to the parallel State Notifications, the same have been retained for consideration by this Court. The lead matter in the said batch is W.P.(C) 9214/2024 titled Engineers India Limited v. Union of India &Ors.

In the present case however, on facts, the submission of the Petitioner is that the Show Cause Notice dated 20th May, 2024 as also the impugned order are not signed by the concerned authority and hence, the same are not valid. Further, the reply dated 1st July, 2024 (hereinafter, ‘reply’) filed on behalf of the Petitioner to the Show Cause Notice has not been considered by the concerned authority before passing the impugned order.

The Court has perused the reply dated 1st July, 2024 filed by the Petitioner, The same reads as under: W.P.(C) 807/2025 “ ”

Further, a perusal of the impugned order reveals that the reply has been considered in the following terms: “Observations and conclusion of the assessing authority : Not Agreed with Tax Payer Specific reasons entered The taxpayer has not specifically responded on the contents of the DRC=-01 related to Reconciliation of E-way bill turnover with GSTR-01/GSTR-09: Amount of supplies in EWB in excess of supplies declared in GSTR-01. The copy of DRC-03 is attached by the taxpayer which was issued on 2G.4.2024 i.e. before the issuance of DRC-01. The financial year mentioned on DRC-03 is 2017-24.

Hence it is not possible to ascertain for which period tax has been paid. Hence on these ground an order for creation of demand issued.”

Today, ld. Counsel for the Petitioner has handed over a challan dated W.P.(C) 807/2025 21st February, 2023 where the tax period has been correctly mentioned as 2018-19. Clearly there was an error in the DRC-03 which was filed by the Petitioner, which resulted in the impugned order. Considering that the same appears to be an error by the Petitioner, the matter is remanded for reconsideration to the concerned Adjudicating Authority.

10.

Accordingly, the impugned order is set aside. The Petitioner is granted time till 10th July 2025, to file the additional documents, if any, that they wish to rely upon. Upon filing of the said documents, the Adjudicating Authority shall issue a notice for personal hearing to the Petitioner. The personal hearing notice shall be communicated to the Petitioner on the following mobile no. and e-mail address: Email Address: ansariadvocate15@gmail.com Mobile No.: 9718503000

11.

The reply dated 1st July, 2024 along with the additional documents filed by the Petitioner, as also the submissions made in the personal hearing proceedings shall be duly considered by the Adjudicating Authority and a fresh order with respect to the SCN shall be passed accordingly.

12.

However, it is made clear that the issue in respect of the validity of the impugned notification is left open. Any order passed by the Adjudicating Authority shall be subject to the outcome of the decision of 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. and this Court in W.P.(C) 9214/2024 titled Engineers India Limited v. Union of India &Ors W.P.(C) 807/2025 13. All rights and remedies of the parties are left open. Access to the GST Portal, shall be provided to the Petitioner to enable uploading of the additional documents/reply if any as also access to the notices and related documents.

14.

The present writ petition is disposed of in above terms. All the pending applications, if any, are also disposed of. PRATHIBA M. SINGH, J. RAJNEESH KUMAR GUPTA, J. MAY 7, 2025/da/rks (corrected & released on 15th May, 2025)