Case Law Details
New Allied LPG Appliances Vs Sales Tax Officer Class Ii/Avato (Delhi High Court)
In the case of New Allied LPG Appliances v. Sales Tax Officer Class II/AVATO, Ward 79 (Delhi High Court), the petitioner challenged a show cause notice (SCN) dated 23 September 2023 and subsequent adjudication order dated 3 December 2023 issued under the GST regime for the financial year 2017-18. The petition also challenged parallel notifications (No. 09/2023-Central Tax of 31 March 2023; No. 09/2023-State Tax of 22 June 2023) issued under Section 168A of the Central Goods and Services Tax Act, 2017 (CGST Act) to extend limitation for issuance of SCNs. The key contention was that the SCN was uploaded on the “Additional Notices” tab of the GST portal, which the petitioner claimed was not visible to them, thus they were deprived of an opportunity to file a reply or secure a personal hearing. The Delhi High Court granted relief to the petitioner on procedural grounds, while leaving open the larger question of the validity of the notifications.
Factual and Legal Background
The petitioner, New Allied LPG Appliances, argued that the SCN issued by the Sales Tax Officer on 23 September 2023 was never effectively communicated. The notice was uploaded on the GST portal under “Additional Notices”, which the petitioner asserted they did not check and were unaware of, thus they did not file a reply and no personal hearing was held before the ex-parte order of 3 December 2023 was passed. The petitioner also challenged the notifications (Central and State) issued under Section 168A CGST, which allow extension of time‐limits for adjudication under Section 73 CGST Act.
On the departmental side, the respondent argued that a reminder notice dated 21 November 2023 had been issued, but no reply was filed by petitioner. The department relied on the notifications to say that limitation had lawfully been extended.
Several legal issues arose: (i) whether uploading an SCN to a less‐visible tab amounts to effective service and affords the taxpayer an opportunity of hearing; (ii) whether orders passed without personal hearing or without realistic opportunity to respond violate principles of natural justice; and (iii) whether the notifications extending limitation under Section 168A are valid, given conflicting High Court judgments and the matter pending before the Supreme Court in M/s HCC‑SEW‑MEIL‑AAG JV v. Assistant Commissioner of State Tax & Ors. (SLP 4240/2025).
Court’s Observations and Precedents
The Delhi High Court noted that the validity of the notifications under Section 168A is itself pending before the Supreme Court, and therefore it would refrain from expressing any opinion on their vires in the present case—exhibiting judicial discipline. The Court observed that multiple High Courts have taken varying views: the Allahabad High Court upheld Notification 09/2023 (Central); the Patna High Court upheld Notification 56/2023 (Central); while the Guwahati High Court quashed Notification 56/2023 (Central). Tax Heal+3Delhi High Court+3Delhi High Court+3
Despite that, the Court emphasised that even if notifications are valid, procedural fairness cannot be ignored. The Court referenced earlier judgments, including:
- Neelgiri Machinery v. Commissioner Delhi GST (W.P.(C) 13727/2024), where the SCN was uploaded on the portal “Additional Notices” tab and demand orders were set aside for remand. TaxGuru
- Satish Chand Mittal v. Sales Tax Officer SGST, Ward 25-Zone 1, where similar service/portal issues caused orders to be set aside. CaseMine+1
- Anant Wire Industries v. Sales Tax Officers, where again portal notice issues led to remand. Tax Heal+1
The Court affirmed that uploading a notice in a tab not clearly visible or accessible to the taxpayer undermines the opportunity to respond, thereby violating principles of natural justice (audi alteram partem). Court Book+1
Decision and Relief Granted
In the present case, the Delhi High Court held that the impugned orders (dated 23 April 2024 and 5 December 2023) must be set aside because the petitioner was denied a proper opportunity of hearing. The Court granted the following relief:
1. The SCN (23 September 2023) is remitted to the adjudicating authority.
2. The petitioner is granted time up to 31 August 2025 to file their reply.
3. Once reply is filed, the authority must issue a notice for personal hearing, which must be communicated by both mobile and e-mail, in addition to portal upload.
4. The petitioner’s GST portal access must be activated within one week to allow reply upload and access to notices/documents.
5. A fresh adjudication shall be conducted, taking into account the reply and oral submissions during hearing.
6. The validity or otherwise of the extension notifications remains open and will be subject to the outcome of the Supreme Court SLP 4240/2025 and related Delhi High Court matters (e.g., Engineers India Ltd. v. Union of India P.(C) 9214/2024).
All pending applications in the writ petition were disposed of accordingly.
Legal Analysis
(1) Natural justice and effective service of notice: The Court reaffirmed that even in a digital age, service of a show cause notice must be such that the addressee is aware and given a fair chance to respond. When the SCN is uploaded in a lesser-visible tab (like “Additional Notices” on the GST portal) and no alternative communication is given, the taxpayer may claim lack of knowledge—a circumstance which the Courts have accepted as ground for remand. Neelgiri Machinery and Satish Chand Mittal demonstrate the consistent judicial line. TaxGuru+2CaseMine+2
(2) Ex-parte adjudication without hearing invalid: Where no reply is filed by the taxpayer due to non-receipt of SCN and no personal hearing is given, issuing demand orders can be held vitiated. The court’s reliance on precedents emphasises that procedural fairness is independent of the substantive merits of the case.
(3) Limitations and extension notifications (Section 168A CGST Act): The notifications extend the statute of limitation under Section 73 CGST. Since High Courts differ on their validity and the question is pending before the Supreme Court (SLP 4240/2025), the Delhi HC wisely avoided pronouncement on that issue in this case, while nonetheless granting relief on procedural grounds. Delhi High Court+1
(4) Remedy and remand: The Court ordered remand for fresh adjudication. This emphasizes that even if the notifications are later held valid, a fair process is a prerequisite. The direction to communicate by email/mobile and grant portal access underscores increasing judicial insistence on taxpayer access and transparency in digital tax administration.
Conclusion
In summary, the Delhi High Court in the New Allied LPG Appliances case has held that procedural fairness cannot be sacrificed in GST adjudication. Even though the larger question of validity of limitation-extension notifications under Section 168A CGST remains pending before the Supreme Court, the Court granted relief on the ground that the SCN was not served effectively — being uploaded under a less visible portal tab — and no personal hearing was granted. The order has been set aside and remitted for fresh adjudication, with instructions to provide the petitioner a fair opportunity of reply and hearing, portal access and email/mobile notice. The case reinforces that regardless of statutory time-extensions, the foundational principles of natural justice apply in GST proceedings.
Taxpayers and practitioners should take note: digital notification systems must be transparent and accessible; mere uploading in obscure portal locations may fail service requirements and invalidate orders. At the same time, challenges to limitation-extension notifications await final resolution at the Supreme Court, meaning some cases will continue to hinge on both procedural and substantive grounds.
FULL TEXT OF THE JUDGMENT/ORDER OF DELHI HIGH COURT
1. This hearing has been done through hybrid mode.
2. The present petition has been filed by the Petitioner inter alia challenging the Show Cause Notice dated 23rd September, 2023 and the consequent order dated 3rd December, 2023 passed in respect of Financial Year 2017-18, by the office of Sales Tax Officer Class II/ AVATO, Ward 79, Zone 4, Delhi.
3. The demand raised upon the Petitioner vide the impugned order is as under:
4. Further, the petition also challenges Notification No.09/2023-Central Tax dated 31st March, 2023 and Notification No.09/2023-State Tax dated 22nd June, 2023 (hereinafter ‘impugned notifications’).
5. The validity of the impugned notification was under consideration before this Court in a batch of petitions with the lead petition being P.(C) 16499/2023 titled ‘DJST Traders Pvt. Ltd. vs. Union of India and Ors.’. In the said batch of petitions, on 22nd April, 2025, the parties were heard at length qua the validity of the impugned notifications and accordingly, the following order was passed:
“4. Submissions have been heard in part. The broad challenge to both sets of Notifications is on the ground that the proper procedure was not followed prior to the issuance of the same. In terms of Section 168A, prior recommendation of the GST Council is essential for extending deadlines. In respect of Notification no.9, the recommendation was made prior to the issuance of the same. However, insofar as Notification No. 56/2023 (Central Tax) the challenge is that the extension was granted contrary to the mandate under Section 168A of the Central Goods and Services Tax Act, 2017 and ratification was given subsequent to the issuance of the notification. The notification incorrectly states that it was on the recommendation of the GST Council. Insofar as the Notification No. 56 of 2023 (State Tax) is concerned, the challenge is to the effect that the same was issued on 11th July, 2024 after the expiry of the limitation in terms of the Notification No.13 of 2022 (State Tax).
5. In fact, Notification Nos. 09 and 56 of 2023 (Central Tax) were challenged before various other High Courts. The Allahabad Court has upheld the validity ofNotification no.9. The Patna High Court has upheld the validity of Notification no.56. Whereas, the Guwahati High Court has quashed Notification No. 56 of 2023 (Central Tax).
6. The Telangana High Court while not delving into the vires of the assailed notifications, made certain observations in respect of invalidity of Notification No. 56 of 2023 (Central Tax). This judgment of the Telangana High Court is now presently under consideration by the Supreme Court in S.L.P No 4240/2025 titled M/s HCC-SEW-MEIL-AAG JV v. Assistant Commissioner of State Tax & Ors. The Supreme Court vide order dated 21st February, 2025, passed the following order in the said case:
“1. The subject matter of challenge before the High Court was to the legality, validity and propriety of the Notification No.13/2022 dated 5-7-2022 & Notification Nos.9 and 56 of 2023 dated 31-3-2023 & 8-12-2023 respectively.
2. However, in the present petition, we are concerned with Notification Nos.9 & 56/2023 dated 313-2023 respectively.
3. These Notifications have been issued in the purported exercise ofpower under Section 168 (A) of the Central Goods and Services Tax Act. 2017 (for short, the “GST Act”).
4. We have heard Dr. S. Muralidhar, the learned Senior counsel appearing for the petitioner.
5. The issue thatfalls for the consideration of this Court is whether the time limit for adjudication of show cause notice and passing order under Section 73 of the GST Act and SGST Act (Telangana GST Act) for financial year 2019-2020 could have been extended by issuing the Notifications in question under Section 168-A of the GST Act.
6. There are many other issues also arising for consideration in this matter.
7. Dr. Muralidhar pointed out that there is a cleavage of opinion amongst different High Courts of the country.
8. Issue notice on the SLP as also on the prayer for interim relief, returnable on 7-3-2025.”
7. In the meantime, the challenges were also pending before the Bombay High Court and the Punjab and Haryana High Court. In the Punjab and Haryana High Court vide order dated 12th March, 2025, all the writ petitions have been disposed of in terms of the interim orders passed therein. The operative portion of the said order reads as under:
“65. Almost all the issues, which have been raised before us in these present connected cases and have been noticed hereinabove, are the subject matter of the Hon’ble Supreme Court in the aforesaid SLP.
66. Keeping in view the judicial discipline, we refrain from giving our opinion with respect to the vires of Section 168-A of the Act as well as the notifications issued in purported exercise of power under Section 168-A of the Act which have been challenged, and we direct that all these present connected cases shall be governed by the judgment passed by the Hon’ble Supreme Court and the decision thereto shall be binding on these cases too.
67. Since the matter is pending before the Hon’ble Supreme Court, the interim order passed in the present cases, would continue to operate and would be governed by the final adjudication by the Supreme Court on the issues in the aforesaid SLP-4240-2025.
68. In view of the aforesaid, all these connected cases are disposed of accordingly along with pending applications, if any.”
8. The Court has heard ld. Counsels for the partiesfor a substantial period today. A perusal of the above would show that various High Courts have taken a view and the matter is squarely now pending before the Supreme Court.
9. Apart from the challenge to the notifications itself, various counsels submit that even if the same are upheld, they would still pray for relieffor the parties as the Petitioners have been unable to file replies due to several reasons and were unable to avail ofpersonal hearings in most cases. In effect therefore in most cases the adjudication orders are passed ex-parte. Huge demands have been raised and even penalties have been imposed.
10. Broadly, there are six categories of cases which are pending before this Court. While the issue concerning the validity of the impugned notifications is presently under consideration before the Supreme Court, this Court is of the prima facie view that, depending upon the categories ofpetitions, orders can be passed affording an opportunity to the Petitioners to place their stand before the adjudicating authority. In some cases, proceedings including appellate remedies may be permitted to be pursued by the Petitioners, without delving into the question of the validity of the said notifications at this stage.
11. The said categories and proposed reliefs have been broadly put to the parties today. They may seek instructions and revert by tomorrow i.e., 23rd April, ”
6. Thereafter, on 23rd April, 2025, this Court, having noted that the validity of the impugned notifications is under consideration before the Supreme Court, had disposed of several matters in the said batch of petitions after addressing other factual issues raised in the respective petitions. Additionally, while disposing of the said petitions, this Court clearly observed that the validity of the impugned notifications therein shall be subject to the outcome of the proceedings before the Supreme Court in S.L.P. No. 4240/2025 titled M/s HCC-SEW-MEIL-AAG JV v. Assistant Commissioner of State Tax & Ors.
7. However, in cases where the challenge is to the parallel State Notifications, the same have been retained for consideration by this Court. The lead matter in the said batch is W.P.(C) 9214/2024 titled Engineers India Limited v. Union of India & Ors.
8. In the present case, the submission of the Petitioner, on facts is that the SCN dated 23rd September 2023, from which the impugned order arises, was uploaded on the ‘Additional Notices Tab’. The same was not brought to the knowledge of the Petitioner due to which no reply was filed. Hence, the impugned order was passed without providing the Petitioner with an opportunity to challenge the show cause notice on merits.
9. The submission on behalf of the Department is that a reminder notice was also issued to the Petitioner 21st November, 2023. However, no reply was filed by the Petitioner to the impugned SCN despite the said reminder.
10. The Court has heard the parties. In fact, this Court in W.P.(C) 13727/2024 titled ‘Neelgiri Machinery through its Proprietor Mr. Anil Kumar V. Commissioner Delhi Goods And Service Tax And Others’, under similar circumstances where the SCN was uploaded on the ‘Additional Notices Tab’ had remanded the matter in the following terms:
“6. Be that as it may, intention is to ensure that the Petitioner is given an opportunity to file its reply and is heard on merits and that orders are not passed in default. Since there is no clarity on behalf of the Department, this Court follows the order dated 9th September, 2024 in Satish Chand Mittal (Trade Name National Rubber Products) vs. Sales Tax Officer SGST, Ward 25-Zone 1 as also order dated 23rd December, 2024 in Anant Wire Industries vs. Sales Tax Officers Class II/Avato, Ward 83 & Anr (W.P.(C) 17867/2024; DHC) where the Court under similar circumstances has remanded back the matter to ensure the Noticee/Petitioners get a fair opportunity to be heard. The order of the Court in Sathish Chand Mittal (Supra) reads as under:
“4. It is the petitioner’s case that he had not received the impugned SCN and, therefore, he had no opportunity to respond to the same. For the same reason, the petitioner claims that he had not appear for a personal hearing before the Adjudicating Authority, which was scheduled on 17.10.2023 and later rescheduled to 30.11.2023 as per the Reminder.
5. The petitioner also states that the impugned SCN, the Reminder and the impugned order are unsigned.
6.Mr. Singhvi, the learned counsel appearing for the respondent, on advance notice,fairly states that the principal issue involved in the present case is squarely covered by the decisions of this Court in M/s ACE Cardiopathy Solutions Private Ltd. v. Union of India & Ors.: Neutral Citation No. 2024:DHC:4108-DB as well as in Kamla Vohra v. Sales Tax Officer Class II/ Avato Ward 52 : Neutral Citation No.2024:DHC:5108- DB.
7. He states that possibly, the petitioner did not had the access of the Notices as they were projected on the GST Portal under the tab ‘Additional Notices & Orders’. He submits that the said issue has now been addressed and the ‘Additional Notices & Orders’ tab is placed under the general menu and adjacent to the tab ‘Notices & Orders’.
8. In view of the above, the present petition is allowed and the impugned order is set aside.
9. The respondent is granted another opportunity to reply to the impugned SCN within a period of two weeks
from date. The Adjudicating Authority shall consider the same and pass such order, as it deemsfit, after affording the petitioner an opportunity to be heard. 10. The present petition is disposed of in the aforesaid terms. 11. All pending applications are also disposed of.”
7. The impugned demand orders dated 23rd April, 2024 and 5th December, 2023 are accordingly set aside. In response to show cause notices dated 04th December, 2023 and 23th September, 2023, the Petitioner shallfile its replies within thirty days. The hearing notices shall now not be merely uploaded on the portal but shall also be e-mailed to the Petitioner and upon the hearing notice being received, the Petitioner would appear before the Department and make its submissions. The show cause notices shall be adjudicated in accordance with law.
8. The petitions are disposed of in the above terms. The pending application(s), if any, also stand disposed of.”
11. There is no doubt that after 16th January 2024, changes have been made to the GST portal and the ‘Additional Notices Tab’ has been made visible. However, in the present case, the SCN was issued on 23rd September, 2023 and the same was not brought to the notice of the Petitioner. Under such circumstances, considering the fact that the Petitioner did not get a proper opportunity to be heard and no reply to the SCN has been filed by the Petitioner, the matter deserves to be remanded back to the concerned Adjudicating Authority.
12. Accordingly, the impugned order is set aside. The Petitioner is granted time till 31st August, 2025, to file the reply to the SCN. Upon filing of the reply, the Adjudicating Authority shall issue a notice for personal hearing to the Petitioner. The personal hearing notice shall be communicated to the Petitioner on the following mobile no. and e-mail address:
Mobile No.: 9716694879
Email: pulkit@enurelegal.com
13. The reply filed by the Petitioner to the SCN along with the submissions made in the personal hearing proceedings shall be duly considered by the Adjudicating Authority and a fresh order with respect to the SCN shall be passed.
14. Access to the GST Portal, shall be provided within one week to the Petitioner to enable uploading of the reply as also to access the notices and related documents.
15. However, it is made clear that the issue in respect of the validity of the impugned notifications is left open. Any order passed by the Adjudicating Authority shall be subject to the outcome of the decision of the Supreme Court in S.L.P No 4240/2025 titled M/s HCC-SEW-MEIL-AAG JV v. Assistant Commissioner of State Tax & Ors and the decision of this court in W.P.(C) 9214/2024 titled Engineers India Limited v. Union of India & Ors.
16. All rights and remedies of the parties are left open.
17. The present writ petition is disposed of in above terms. All the pending applications, if any, are also disposed of.
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