Facts of the Case

The petitioner, Chirag Garg, filed a writ petition under Article 226 of the Constitution of India challenging an order dated 28 August 2024 passed by the Sales Tax Officer, whereby a demand of ₹19,79,840/- was raised.

The petitioner contended that a Show Cause Notice (SCN) dated 31 May 2024 was not responded to as it was uploaded under the “Additional Notices Tab” on the GST portal, due to which it was inadvertently missed.

Issues Involved

  1. Whether non-response to an SCN uploaded in the “Additional Notices Tab” can justify setting aside an ex parte GST order.
  2. Whether the petitioner should be granted an opportunity of hearing despite failure to respond to the SCN.
  3. Whether conditional relief (deposit of tax amount) can be imposed while remanding the matter.

Petitioner’s Arguments

  • The SCN was not noticed as it was placed in the “Additional Notices Tab,” leading to non-filing of reply.
  • The petitioner had a substantial electronic credit ledger balance (approx. ₹4.8 crores), indicating bona fides.
  • The petitioner expressed willingness to deposit the tax amount subject to the matter being remanded and an opportunity to respond being granted.

Respondent’s Arguments

  • The “Additional Notices Tab” had been functional and visible on the GST portal since 16 January 2024.
  • Therefore, the petitioner cannot rely on ignorance of the tab as a valid ground for non-response.

Court’s Findings / Order

  • The Court held that the argument regarding the “Additional Notices Tab” was not tenable since the SCN was issued after the feature became operational.
  • However, considering that:
    • the impugned order was ex parte, and
    • the petitioner had not been heard on merits,

the Court granted relief in the interest of justice.

Directions Issued:

  1. The petitioner shall deposit ₹10,22,963/- by 10 July 2025 (including use of ITC if available).
  2. A reply to the SCN shall be filed by the same date.
  3. A personal hearing shall be granted.
  4. The impugned order was set aside and the matter remanded for fresh adjudication.
  5. Observations made shall not affect merits of the case.

Important Clarifications

  • Mere placement of notice in a specific tab on the GST portal is not a valid defense once the system is operational and accessible.
  • However, principles of natural justice prevail, especially where orders are passed ex parte.
  • Courts may grant relief subject to deposit conditions to balance revenue interests and fairness.

Sections / Legal Provisions Involved

  • Article 226 of the Constitution of India
  • GST Law (Show Cause Notice & Adjudication Provisions)
  • Principles of Natural Justice (Audi Alteram Partem)

Link to download the order -  https://delhihighcourt.nic.in/app/showFileJudgment/PMS22052025CW69782025_183130.pdf

 

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