M/s Crayons Net Solutions Pvt. Ltd. v. Union of India & Ors.

Case Details

• Case Title: M/s Crayons Net Solutions Pvt. Ltd. v. Union of India & Ors.

• Court: Delhi High Court

• Petition Number: W.P.(C) 4967/2025 & CM Appl. 22832/2025

• Date of Judgment: 23rd April 2025

• Relevant Section: Section 73, Section 168A of the CGST Act, 2017

• Category of Dispute: GST Demand – Validity of SCN & Notification Challenge

• Impugned Notification: Notification No. 9/2023-Central Tax dated 31.03.2023

Facts of the Case

1. The petitioner challenged SCN dated 25.09.2023 and demand order dated 16.12.2023 issued under Section 73 of CGST Act, 2017 pertaining to FY 2017–18, alleging that the SCN was uploaded only in the “Additional Notices Tab” and not properly communicated, leading to an ex-parte order (Para 2, 6).

2. The petitioner also challenged Notification No. 9/2023-Central Tax dated 31.03.2023, which extended limitation under Section 168A, contending it was issued without proper GST Council recommendation (Para 3–4).

3. The petitioner relied on earlier Delhi HC rulings such as Neelgiri Machinery (W.P.(C) 13727/2024) and Satish Chand Mittal (W.P.(C) 12589/2024) where matters were remanded back due to improper service of SCNs (Para 7).

Questions in Consideration

1. Whether the SCN uploaded only under the “Additional Notices Tab” without proper service vitiates the adjudication process? (Para 6–7)

2. Whether Notification No. 9/2023 issued under Section 168A is valid and enforceable? (Para 4–5, 11)

3. Whether the impugned demand order passed without granting personal hearing is sustainable? (Para 6–7).

Observations of the Court

1. The Court noted that the validity of Notification 9/2023 and 56/2023 is pending adjudication before the Supreme Court in SLP No. 4240/2025 (M/s HCC-SEW-MEIL-AAG JV v. Assistant Commissioner of State Tax & Ors.), hence the challenge in this case will also be subject to the SC outcome (Para 5, 11).

2. The Court observed that SCNs uploaded under “Additional Notices Tab” were not reasonably accessible to taxpayers, leading to lack of proper opportunity to reply or appear for hearing. Similar cases had been remanded (Para 7–8).

3. It was noted that after 16.01.2024, GST portal changes were implemented to make SCNs more visible, but since this SCN was of Sept 2023, the petitioner could not be faulted (Para 8).

Judgment of the Court

1. The impugned order dated 16.12.2023 was set aside (Para 8–9).

2. The matter was remanded back to the Adjudicating Authority with directions:

   • Petitioner to file reply within 30 days.

   • Department to grant personal hearing, with notices also sent via email & phone (Para 9).

   • Matter to be adjudicated afresh on merits (Para 10).

3. Challenge to Notification 9/2023 left open, subject to Supreme Court’s verdict (Para 11).

4. Writ petition was disposed of accordingly (Para 12).

Between Fine Lines (Simplified Summary in 5 Points)

• SCNs uploaded only in the “Additional Notices Tab” cannot be treated as proper service.

• Ex-parte orders without fair hearing are not sustainable.

• Delhi HC remanded matter to give the taxpayer a chance to reply and be heard.

• Validity of GST Notification 9/2023 is pending before the Supreme Court.

• Adjudicating authority must follow principles of natural justice before fresh order.

Summary of Referred Cases