Facts of the Case

M/S Gupta Sanitation challenged an order dated 18th April, 2024 passed by the Sales Tax Officer Class II/AVATO for the tax period April 2018 to March 2019, along with the underlying show cause notice dated 4th December, 2023, and separately challenged the vires of Notification No. 56/2023-Central Tax dated 28th December, 2023, which had extended the limitation period for passing Section 73 orders. This challenge was part of a large batch of petitions before the Delhi High Court, with the lead matter, DJST Traders Private Limited v. Union of India, having already traced a complex procedural history: differing views among the Allahabad, Patna and Guwahati High Courts on Notification 56/2023's validity, and the issue now pending before the Supreme Court in SLP No.4240/2025 (M/s HCC-SEW-MEIL-AAG JV).

Issues Involved

  1. Whether the vires of Notification No. 56/2023-Central Tax, issued under Section 168A of the CGST Act extending limitation for Section 73 orders, can be adjudicated by the High Court while the identical question is pending before the Supreme Court.
  2. Whether the petitioner, having filed no reply to the SCN or reminder notice due to the notice appearing under the portal's 'Additional Notices Tab', is nonetheless entitled to a fresh opportunity to contest the demand on merits.
  3. What interim protection should be granted to the petitioner pending final resolution of the Notification's validity by the Supreme Court.

Petitioner's Arguments

  • The petitioner argued that the impugned SCN and order had been uploaded on the 'Additional Notices Tab' of the GST portal rather than the main notices tab, and were therefore not brought to its knowledge despite continuous filing of its returns.
  • It was submitted, following the batch order in DJST Traders, that even if Notification 56/2023 were ultimately upheld, the petitioner should still be granted an opportunity to place its case before the adjudicating authority, since no reply had been filed and no personal hearing attended.

Respondent's Arguments

  • The Department's counsel did not seriously dispute that the 'Additional Notices Tab' had become visible only after 16th January, 2024, but pointed out that a reminder notice dated 29th February, 2024 was also issued after the change, and the order was passed only on 18th April, 2024 — after the tab discrepancy issue could reasonably have been resolved.

Court Order / Findings

  • The Court traced the elaborate procedural history of the Notification 56/2023 litigation across High Courts and the pending Supreme Court SLP, noting that the Delhi High Court itself, in the DJST Traders batch, had adopted a category-wise approach — permitting affected petitioners to place their case before the adjudicating authority pending the vires determination, rather than deciding the notification's validity itself.
  • Following its own precedent in Sugandha Enterprises (a similarly-facted case where no SCN reply was filed), the Court held that since the petitioner had not been afforded an opportunity to be heard, the impugned order deserved to be set aside and the petitioner granted a fresh opportunity to file its reply and be heard, while expressly leaving the challenge to Notification 56/2023's validity open, subject to the outcome of SLP No.4240/2025 pending before the Supreme Court.
  • The impugned order was set aside subject to payment of Rs.10,000/- as costs to the Delhi High Court Staff Welfare Fund, with the petitioner granted time till 15th January, 2026 to file its reply, following which a personal hearing would be afforded and a fresh reasoned order passed, subject always to the Supreme Court's final decision on the Notification.

Important Clarification

  • Where the vires of Notification No. 56/2023-Central Tax (extending Section 73 limitation) is under challenge, Delhi High Court is systematically deferring the vires question to the Supreme Court (SLP No.4240/2025) while independently granting individual petitioners a fresh opportunity to contest their demands on procedural/natural-justice grounds.
  • An SCN or order surfacing only under the GST portal's 'Additional Notices Tab' — a change effective from 16th January, 2024 — continues to be treated sympathetically as a possible cause of genuine non-receipt, warranting a remand even where a reminder notice was later issued.
  • Any adjudication order passed pursuant to such a remand remains expressly subject to the Supreme Court's eventual ruling on the Notification's validity, keeping the door open for a fresh challenge if the Notification is ultimately struck down.

Sections Involved

  • Section 168A of the Central Goods and Services Tax Act, 2017 – empowers extension of time limits on GST Council recommendation, under which Notification No. 56/2023-Central Tax was issued and is under challenge.
  • Section 73 of the CGST Act, 2017 – the provision governing the underlying demand, whose limitation period was purportedly extended by the impugned notification.
  • Notification No. 56/2023-Central Tax dated 28.12.2023 – the specific notification whose validity remains sub judice before the Supreme Court.

Decision – In Favour of

Disposed of with directions, in part in favour of the assessee — the ex-parte order was set aside on cost payment and a fresh hearing was granted, but the larger vires question was left undecided pending the Supreme Court's ruling.

Case Details

Court: High Court of Delhi at New Delhi
Case No.: W.P.(C) 18778/2025
Coram: Hon'ble Justice Prathiba M. Singh and Hon'ble Justice Shail Jain
Date of Order: 10.12.2025

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