Shudh Hospitality Private Limited Vs Goods And Service Tax Officer Ward- 44 (Delhi High Court)
In a case highlighting ongoing legal challenges to government notifications extending time limits under the Goods and Services Tax (GST) regime, the Delhi High Court has allowed a taxpayer to file a delayed appeal against a tax demand order. The court’s decision, however, explicitly left the fundamental question of the notifications’ validity open, noting that the matter is currently under consideration by the Supreme Court of India.
The petition was filed by M/s Shudh Hospitality Private Limited, challenging a show cause notice (SCN) dated September 24, 2023, issued by the Sales Tax Officer (STO), Delhi, and the subsequent order dated December 30, 2023. The taxpayer also challenged the legal standing of two specific notifications: Notification No. 56/2023-Central Tax dated December 28, 2023, and Notification No. 9/2023-Central Tax dated March 31, 2023. These notifications are pertinent as they extend deadlines for initiating and completing tax adjudication proceedings under the GST Act.
The core of the challenge to the notifications revolved around the procedure mandated by Section 168A of the Central Goods and Services Tax Act, 2017. This section requires a prior recommendation from the GST Council before such extensions can be issued. The petitioner and others in similar cases argued that, particularly for Notification No. 56/2023, the necessary recommendation from the GST Council was either absent or obtained after the notification was issued, contrary to the statutory requirement. It was also contended that Notification No. 56 incorrectly stated it was based on a GST Council recommendation. A similar challenge was raised against a related State Tax notification (Notification No. 56 of 2023 – State Tax), alleging it was issued after the expiry of the limitation period set by a previous notification (Notification No. 13 of 2022 – State Tax).
