GST Demand Order Set Aside for Denial of Hearing Post-Audit; Case Remanded for Fresh Adjudication

Procter And Gamble Home Products Private Limited Vs Goods and Services Tax Council & Ors. (Delhi High Court)

Delhi High Court has set aside a Goods and Services Tax (GST) demand order against Procter & Gamble Home Products (P.) Ltd., citing a denial of a proper hearing opportunity to the company after an audit. The court has remanded the matter for fresh adjudication, allowing the petitioner to file a comprehensive reply to the show cause notice and receive a personal hearing.

The case, W.P.(C) 6169/2024, involved Procter & Gamble’s challenge to an audit notice dated August 24, 2023, a show cause notice dated January 30, 2024, and an order dated April 23, 2024. The petitioner also challenged the validity of Notification No. 56/2023-Central Tax dated December 28, 2023, and Notification No. 56 of 2023-State Tax dated July 11, 2024, which were issued under Section 168A of the Central Goods and Services Tax Act, 2017 (CGST Act) concerning the extension of deadlines.

Challenge to Notifications and Judicial Precedents: A significant portion of the High Court’s deliberation centered on the challenge to the vires of the aforementioned notifications. These notifications, which extended time limits for adjudication and passing orders under Section 73 of the GST Act, have been a subject of contention across various High Courts in India.

The Delhi High Court noted that the validity of similar central notifications (Notification Nos. 56/2023-CT and 09/2023-CT) is currently under consideration 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.

The court highlighted the existing “cleavage of opinion” among different High Courts regarding these notifications: