Delhi Msw Solutions Limited vs. The Assistant Commissioner Of State Tax & Ors.
Original PDF →Facts
The Petitioner, Delhi MSW Solutions Limited, filed a writ petition challenging an order dated February 28, 2025, which confirmed a demand of Rs. 1,60,35,990.00. A Show Cause Notice (SCN) was initially issued on November 19, 2024, alleging availment of excess Input Tax Credit (ITC). The Petitioner contended that their detailed reply to the SCN was not considered by the adjudicating authority. The Revenue, represented by the Assistant Commissioner, stated that the reply was considered, leading to a reduction in the initial demand from Rs. 7,74,72,844/- to approximately Rs. 1.60 crores. It was also revealed that a rectification application under Section 161 of the CGST Act, 2017, had been filed by the Petitioner and was pending.
Held
The Court noted that a rectification application had been filed by the Petitioner under Section 161 of the Central Goods And Services Tax Act, 2017, and was pending before the concerned official. Considering this development, the Court was of the opinion that a personal hearing should be afforded to the Petitioner in relation to the rectification application. The concerned official was directed to communicate the date of hearing to the Petitioner through the Portal and also to the Petitioner's counsel. The Court explicitly stated that all rights and remedies of the Petitioner concerning both the impugned order and any subsequent rectification order were left open. The Court did not decide on the merits of the Petitioner's contention regarding the non-consideration of their reply to the SCN, deferring it to the rectification process.
Key Issues
1. Whether the adjudicating authority properly considered the Petitioner's reply to the Show Cause Notice before passing the impugned order, as required by principles of natural justice? 2. Whether the pendency of a rectification application filed by the Petitioner under Section 161 of the CGST Act, 2017, has any bearing on the adjudication of the present writ petition? Petitioner's Arguments: The Petitioner argued that their reply to the SCN was not considered by the adjudicating authority, necessitating a remand. The Petitioner's counsel also stated that they were not informed by their client about the filing of the rectification application. Revenue's Arguments: The Revenue contended that the entire reply submitted by the Petitioner was considered, and this consideration led to a significant reduction in the demand amount. The Revenue also highlighted the pendency of the rectification application filed by the Petitioner.
Sections Cited
Section 161
AI-generated summary — verify with the full judgment below
Cause title — parties, addresses and appearances
O R D E R %
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 seeking to quash the impugned order dated 28th February, 2025 wherein a demand of Rs.1,60,35,990.00/- has been confirmed against the Petitioner.
The case of the Petitioner is that a Show Cause Notice (hereinafter ‘SCN’) was issued on 19th November, 2024 and a detailed reply was submitted by the Petitioner. The primary allegation is regarding availment of excess Input Tax Credit (hereinafter ‘ITC’) by the Petitioner. The Petitioner’s Counsel today submits that the reply has not been considered by the adjudicating authority and hence the matter deserves to be remanded to Respondent No.1-the Adjudicating Authority (GST Department).
After perusing the matter, the Court had directed the officer concerned i.e., the Assistant Commissioner – Mr. Ahuja to join the proceedings virtually. Post lunch, on the second call, he has joined the proceedings and explained 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 01/07/2025 at 18:35:16
that the entire reply has been considered. In fact, the initial demand as can be seen from the impugned SCN was to the tune of Rs.7,74,72,844/- and after considering the reply, the same has been reduced to the amount of Rs.1.60 crores approximately. He further submits that a rectification application has also been filed under Section 161 of the Central Goods And Services Tax Act, 2017 and the same is pending consideration before him.
On a query being put to the ld. Counsel for the Petitioner as to why the pendency of the rectification has not been disclosed in the writ petition, ld. Counsel submits that his client had not informed him about the rectification application.
Considering this position, the Court is of the opinion that in the rectification application, a personal hearing can be afforded to the Petitioner by the concerned official and an order be passed in accordance with law. The date of hearing be communicated to the Petitioner, through the Portal as also through the ld. Counsel who is appearing today. The contact details of the Petitioner’s counsel are set out below for ready reference: Name: Mr. Aayush Agarwala, Advocate Email: pba.office@pba.net.in Mob. No.: 9999105064
All rights and remedies of the Petitioner in respect of the impugned order as also the rectification order, if any, are left open.
The petition is disposed of in these terms. All pending applications, if any, are also disposed of.
PRATHIBA M. SINGH, J
RAJNEESH KUMAR GUPTA, J APRIL 15, 2025/Rahul/Ar. 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 01/07/2025 at 18:35:16
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.