Sai Overseas Vs Union of India & Ors. (Delhi High Court)
Ex Parte GST Order Set Aside
The Delhi High Court considered a challenge to an order dated 18.02.2025 passed under Section 73 of the CGST Act, 2017. The petitioner had been proceeded against ex parte pursuant to a show cause notice dated 20.11.2024 that was uploaded on the web portal.
Reliance on Luxmi Traders
The Court referred to Luxmi Traders v. Union Territory of Chandigarh & Ors., (2026) 44 Centax 371 (P&H), where it was held that service of an SCN cannot be deemed sufficient merely because it is uploaded on the Common Portal unless receipt is acknowledged or a reply is filed. Where an ex parte order follows portal-only service without a reply, proceedings are to be restored to the SCN stage, with an opportunity to file a reply and be heard.
The respondents submitted that proceedings alleging fraud had also been initiated under Section 74 of the CGST Act.
Matter Remitted for Fresh Adjudication
In view of the ex parte order having followed the portal-only uploading of the SCN, the Delhi High Court remitted the matter to the Adjudicating Authority for fresh adjudication in accordance with the directions in Luxmi Traders. The authority was permitted to consider the proceedings stated to have been initiated under Section 74.
The petitioner was directed to appear before the specified authority on 20.08.2026 at 11:00 A.M. The Adjudicating Authority was directed to pass a fresh order in accordance with law after considering the petitioner’s reply, if any. The writ petition and pending application were disposed of.
FULL TEXT OF THE JUDGMENT/ORDER OF DELHI HIGH COURT
1. Learned Counsel representing the Petitioner gives up the challenge to Notification No.40/2021-Central Tax [F.No.CBIC-20013/7/2021-GST] dated 29.12.2021 and Notification No. 40/2021-State Tax [F.No.3 (5)/Fin. (Exp-I)/2022-23/Ds-I/488] (Delhi) dated 09.06.2022.
2. The Petitioner, however, challenges the Impugned Order dated 18.02.2025 passed by the Sales Tax Officer, Class II, while exercising powers under Section 73 of the Central Goods and Services Tax Act, 2017 (hereinafter referred to as ‘CGST Act’). Pursuant to the Show Cause Notice dated 20.11.2024 (hereinafter referred to as ‘SCN’), the Petitioner was proceeded against ex parte on the basis of the SCN having been uploaded on the web portal.
3. A Division Bench of the Punjab and Haryana High Court, in Luxmi Traders v. Union Territory of Chandigarh & Ors., (2026) 44 Centax 371 (P&H), in Paragraph No.60, has held as under:
“60. On the basis of discussions and deliberations aforesaid, we come to the following conclusions: –
i. Service of SCN upon the petitioner/assessee concerned cannot be deemed sufficient merely on account of its uploading on the Common Portal, unless its receipt is acknowledged or a reply is filed.
ii. Where SCN is served only by way of uploading it on the Common Portal and in the absence of reply filed by the petitioner/assessee concerned, ex parte order is passed in original, the proceedings would stand restored to the stage of issuance of SCN and the petitioner would be at liberty to file reply to the SCN within a period offour weeks from today whereafter, the Department shall proceed further after affording required opportunity of hearing.
iii. In cases where the order-in-original is passed after contest and is served only by uploading it on the Common Portal, the period of limitation for filing of appeal would not be triggered, and the assessee aggrieved will have the right to file an appeal within a period offour weeks from today.
iv. Where appeals filed against the order-in-original, which was served only by uploading it on the Common Portal are dismissed on the ground of limitation, the order of the Appellate Court shall be set aside and the appeal would stand restored to its original number and would be heard and decided on merits.
v. In cases where SCNs were served only on portal and ex parte adjudication order was passed for want of reply of assessee and appeal against the said order was dismissed on the ground of delay, both adjudication order and order-in-appeal shall be set aside and proceedings will be restored at the stage of issuance of SCN and petitioner/assessee shall be at liberty to file reply to SCN within four weeks from today, whereafter, the department shall proceed further after affording due opportunity of hearing.”
4. Learned Counsel representing the Respondents submits that the CGST Authorities have also initiated proceedings against the Petitioner alleging fraud.
5. Be that as it may, in view of the fact that the Impugned Order dated 18.02.2025 came to be passed ex parte pursuant to the SCN having been uploaded on the web portal, the matter is remitted to the Adjudicating Authority for fresh adjudication in terms of the directions issued in Luxmi Traders (supra).
6. The Adjudicating Authority shall be at liberty to take into consideration the proceedings stated to have been initiated under Section 74 of the CGST Act, as submitted by learned Counsel representing the Respondents.
7. The Petitioner is directed to appear before the following Authority on 20.08.2026 at 11:00 A.M.:
Sales Tax Officer Class II / AVATO,
Ward 27, Zone 1,
Through Secretary
Department of Trade and Taxes,
GNCTD, Vyapar Bhawan, I.P. Estate, New Delhi – 110002
Email: [email protected]
8. The Adjudicating Authority shall pass a fresh order in accordance with law after considering the Reply, if any, filed by the Petitioner.
9. With the aforesaid observations, the present Writ Petition, along with pending application, stands disposed of.
