DLF Home Developers Limited Vs Sales Tax Officer Class II Ava to Ward 107 Special Zone 12 Delhi & Anr. (Delhi High Court)
Delhi High Court ruled on a petition filed by DLF Home Developers Limited challenging a GST demand of ₹28.79 crore, including interest and penalties, for the tax period from July 2017 to March 2018. The dispute arose under Section 73 of the Central Goods and Services Tax (CGST) Act, 2017, and its Delhi counterpart. DLF contested only a part of the demand related to Input Tax Credit (ITC) reversal on non-business transactions and exempt supplies, arguing that the same issue was already under investigation by the Directorate General of GST Intelligence (DGGI).
DLF contended that parallel proceedings by two different authorities on the same issue were not permissible under Section 6(2)(b) of the CGST Act, 2017. The company highlighted that the DGGI had issued a separate show cause notice on February 2, 2024, covering the period from July 2017 to March 2021, which included the disputed ITC reversal. The impugned order by the Sales Tax Officer had acknowledged this but still proceeded to confirm the demand without adjudication.
The court found merit in DLF’s argument and held that two parallel proceedings on the same subject matter could not continue. The government counsel also conceded that the demand in question should be set aside as it would be adjudicated by the DGGI. Citing the principles of jurisdictional conflict and procedural fairness, the court directed that the ITC reversal-related demand under the impugned order be set aside. The matter would now be decided solely through the DGGI proceedings.
