Bhutani Automobiles LLP vs. Union Of INDIA & Ors.

Held

The Court acknowledged that the challenge to the impugned notifications was pending before the Supreme Court in SLP No. 4240/2025. Therefore, the Petitioner's challenge to these notifications in the present proceedings would be subject to the outcome of the Supreme Court's decision. Regarding the Petitioner's specific case, the Court noted that a reply to the Show Cause Notice had already been filed. Considering this, and the fact that the Petitioner's GST registration was cancelled and it underwent a conversion, the Court found it to be an ideal case for relegating the Petitioner to the appellate remedy. The Court directed the Petitioner to file an appeal before the Appellate Authority by January 31, 2026, along with the necessary pre-deposit and costs of Rs. 10,000/-. The appeal, if filed within the stipulated time, would not be treated as barred by limitation and would be adjudicated on merits. The decision of the Appellate Authority would be subject to the decisions of the Supreme Court and this Court in related matters. The Petitioner was also granted access to the GST portal to download necessary documents.

Facts

The Petitioner, Bhutani Automobiles LLP, challenged an order dated December 28, 2023, passed by the Sales Tax Officer Class II/Avato Ward 46, Zone 3, Delhi, which raised a demand for Financial Year 2017-18. This order stemmed from a Show Cause Notice dated September 25, 2023. The Petitioner also challenged Notifications No. 09/2023-Central Tax and 09/2023-State Tax. The challenge to these notifications was similar to a batch of petitions where the lead matter was DJST Traders Private Limited v. Union of India &Ors. The High Court noted that the validity of these notifications was under consideration before the Supreme Court in SLP No. 4240/2025. The Petitioner's GST registration was cancelled on March 19, 2024, and it converted from a private limited company to an LLP on April 24, 2024.

Key Issues

1. Whether the impugned Notifications No. 09/2023-Central Tax and 09/2023-State Tax are valid, considering the procedure followed for their issuance and their reliance on Section 168A of the CGST Act. - Petitioner's argument: The Petitioner, along with other petitioners in a batch, challenged the validity of the notifications, arguing that the proper procedure was not followed prior to their issuance, and that the extension of deadlines was contrary to the mandate under Section 168A of the CGST Act. They also argued that ratification was given subsequent to the issuance of the notification, and the notification incorrectly stated it was on the recommendation of the GST Council. - Revenue's argument: The judgment does not explicitly record arguments from the Revenue regarding the validity of the notifications. However, the Court notes that various High Courts have taken different views, and the matter is pending before the Supreme Court. 2. Whether the Petitioner should be relegated to the appellate remedy, given that a reply to the SCN was filed and the matter of notification validity is pending before the Supreme Court. - Petitioner's argument: The Petitioner argued that they were unable to file replies due to several reasons and could not avail of personal hearings, leading to ex-parte adjudication orders and huge demands, including penalties. - Revenue's argument: The Respondent contended that the Petitioner had waived the personal hearing.