Facts of the Case

M/S Mathur Polymers, a proprietary concern, challenged an Order-in-Original dated 2 February 2025 confirming a demand of Rs.81,54,990/- towards fraudulently availed Input Tax Credit, on the ground that personal hearing notices were never received. On the Department producing an affidavit and e-mail records showing three hearing opportunities communicated to the registered e-mail address on the GST portal, the petitioner shifted its contention to argue that the e-mail address belonged to its Chartered Accountant and not to the proprietor.

Issues Involved

  1. Whether communication of hearing notices to the e-mail address registered on the GST portal constitutes sufficient service under Section 169 of the CGST Act.
  2. Whether a single, consolidated show cause notice and order covering allegations of fraudulent ITC availment spanning multiple financial years is impermissible under Section 74.

Petitioner's Arguments

  • No proper hearing notices were received; relying on Mrs. Neelam Ajit Phatarpekar v. Assistant Commissioner of Income Tax, it was argued that notice to a Chartered Accountant's e-mail is not sufficient service.
  • Relying on State of J&K v. Caltex (India) Ltd. and Titan Company Ltd. v. Joint Commissioner of GST and Central Excise (Madras HC), it was argued that bunching of show cause notices/orders across multiple financial years under Section 73/74 is impermissible, and separate orders must be passed for each financial year.

Respondent's Arguments

  • Two hearing notices, sent by e-mail to the registered GST-portal e-mail address on 13 and 18 January 2025, gave three opportunities for personal hearing, and the registered e-mail address was that of the proprietor (Suman Mathur) herself, not merely a GST practitioner.
  • Following Ambika Traders v. Additional Commissioner, Adjudication, DGGSTI, it was argued that Sections 73(3)/(4) and 74(3)/(4) use the language "for any period"/"for such periods", permitting a consolidated notice for allegations of fraudulent ITC spanning several financial years.

Court Order / Findings

  • Under Section 169(1)(c) of the CGST Act, communication to the e-mail address provided at the time of registration is adequate service; since the registered e-mail address was confirmed to be that of the proprietor and not merely a consultant, and this material fact was conspicuously omitted from the writ petition, the personal hearing notices were validly served.
  • Distinguishing Caltex (India) (a sales tax case where the assessment could be dissected period-wise) and Titan Company (not an ITC-fraud case), and following its own reasoning in Ambika Traders, the Court held that in cases of fraudulent availment of ITC, where transactions and fake supply chains typically span several financial years, a consolidated notice and order is permissible under the "period"/"periods" language of Sections 73(3)/(4) and 74(3)/(4), as distinct from the "financial year" language of Sections 73(10)/74(10).
  • Finding no jurisdictional error or violation of natural justice, and that material facts had been concealed regarding service of hearing notices, the writ petition was dismissed with costs of Rs.50,000/- payable to the CGST Department.

Important Clarification

  • Communication of a personal hearing notice to the e-mail address registered on the GST portal is sufficient service under Section 169(1)(c) of the CGST Act, even if that address happens to be used by the taxpayer's Chartered Accountant, so long as it is the address on record as the taxpayer's own registered e-mail.
  • Bunching of show cause notices/orders across multiple financial years is permissible in cases involving allegations of fraudulent ITC availment (using the "period"/"periods" language of Sections 73(3)-(4)/74(3)-(4)), even though such bunching may not be permissible for ordinary, non-fraud demands under Section 73 tied to a specific "financial year".

Sections Involved

  • Section 74, CGST Act, 2017 – demand of tax involving fraud/wilful suppression; sub-sections (3)/(4) ("period"/"periods") vs sub-section (10) ("financial year").
  • Section 169, CGST Act, 2017 – modes of service of notice, including e-mail to the registered address.
  • Section 16, CGST Act, 2017 – Input Tax Credit.

Decision – In Favour of

Decided in favour of the Department – the writ petition is dismissed with costs of Rs.50,000/-.

Case Details

  • Court: High Court of Delhi at New Delhi
  • Case No.: W.P.(C) 2394/2025
  • Coram: Hon'ble Justice Prathiba M. Singh and Hon'ble Justice Shail Jain
  • Date of Decision: 26 August 2025

Link to Download the Order

Click here to view/download the full order

Disclaimer

This content is shared strictly for general information and knowledge purposes only. Readers should independently verify the information from reliable sources. It is not intended to provide legal, professional, or advisory guidance. The author and the organisation disclaim all liability arising from the use of this content. The material has been prepared with the assistance of AI tools.