Delhi HC Remands GST Demand Order for Fresh Hearing Due to Improper Notice Service

Case Reference:

• Case: M/s Divine Creations vs. AVATO, Ward 07, Delhi State GST & Anr.

• Court: High Court of Delhi

• Petition No.: W.P.(C) 16853/2024 & CM APPL. 71385/2024

• Date of Judgement: 07.05.2025 (Corrected & released on 13.05.2025)

• Category: Natural Justice / Procedural Fairness

• Relevant Sections: Section 73 & Section 168A, CGST Act, 2017; Article 226, Constitution of India

• Related Notification: Notification No. 56/2023-Central Tax dated 28.12.2023

Facts of the Case

(Ref: ¶2, ¶6–7)

1. The Petitioner challenged (i) SCN dated 16.05.2024, (ii) consequent order dated 19.08.2024, and (iii) rejection of rectification application dated 10.10.2024.

2. Petitioner also challenged the vires of Notification No. 56/2023-Central Tax.

3. The SCN and subsequent hearing reminders were uploaded only under the “Additional Notices Tab” on GST portal, which Petitioner claimed they were unaware of, resulting in non-filing of reply and absence from hearings.

4. The rectification plea was rejected, upholding the ex-parte demand order.

Question(s) in Consideration

(Ref: ¶4–5, ¶10–11)

1. Whether the impugned demand order passed without effective service of SCN and hearing notice violates principles of natural justice.

2. Whether the matter should be remanded for fresh adjudication in light of Supreme Court pending decision on validity of Notification No. 56/2023.

Observation of the Court

(Ref: ¶8–10)

1. Multiple High Courts have given differing opinions on Notification No. 56/2023; the matter is pending before the Supreme Court in SLP No. 4240/2025.

2. Court noted that similar cases (Neelgiri Machinery, Satish Chand Mittal, Anant Wire Industries) were remanded where notices were uploaded only in “Additional Notices Tab”.

3. Acknowledged that GST portal was updated post-16.01.2024, but petitioner’s grievance arose before they could access the notices.

4. Found that petitioner was denied a fair opportunity to reply and be heard.

Judgement of the Court

(Ref: ¶11–15)

1. Impugned order dated 19.08.2024 set aside.

2. Matter remanded to Adjudicating Authority. Petitioner allowed time till 10.07.2025 to file reply to SCN.

3. Authority directed to issue personal hearing notice via email & mobile, not just portal upload.

4. Issue of validity of Notification No. 56/2023 kept open, subject to Supreme Court’s verdict.

5. Access to GST portal to be ensured for petitioner for filing reply and viewing documents.

Between Fine Lines

• Delhi HC held that orders passed without ensuring proper service of SCN and hearing notice breach natural justice.

• Notices uploaded only under “Additional Notices Tab” on GST portal were insufficient for fair hearing.

• Ex-parte GST demand orders in such cases can be set aside and remanded.

• The wider constitutional challenge to Notification No. 56/2023 is pending before the Supreme Court.

• Proper electronic and email communication is essential for GST proceedings.

Summary of Referred Cases

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