Delhi High Court directs petitioner to avail appellate remedy, holding that adjudication order duly considered reply; challenge to notifications kept open pending Supreme Court’s verdict

Case Details

Case Title: M.V. Metals through its Proprietor Mr. Rahul Jain v. Commissioner, Delhi Goods and Service Tax & Ors.
Court: Delhi High Court
Petition No.: W.P.(C) 6029/2025
Date of Judgment: 27th May 2025
Category of Dispute: Challenge to adjudication order and validity of notifications under Section 168A CGST Act – Limitation and procedure for extension of time
Relevant Sections: Section 73, Section 107, Section 168A of CGST Act, 2017
Notifications in Question: 9/2023-Central Tax (31.03.2023), 56/2023-Central Tax (28.12.2023), 56/2023-State Tax (11.07.2024)

Facts (Paras 3–9)

M.V. Metals received a Show Cause Notice dated 16th May 2024 for the FY 2019–20 demanding ₹6,25,534/-. The petitioner filed a reply with documents on 15th June 2024 and also attended a personal hearing. However, the adjudicating authority passed an order dated 30th August 2024 confirming demand, observing that the petitioner failed to provide supporting records like e-way bills, invoices, bank statements, and purchase registers. The petitioner challenged both the SCN and order under Article 226, also assailing the vires of Notifications 9/2023, 56/2023 (Central) and 56/2023 (State), contending that they were ultra vires Section 168A CGST Act.

Questions before the Court (Paras 4–9)

1. Whether the impugned adjudication order suffered from non-application of mind and denial of fair hearing?

2. Whether the petitioner could bypass the statutory appellate remedy under Section 107 CGST Act and invoke writ jurisdiction?

3. Whether the impugned notifications extending limitation under Section 168A were valid (subject matter already pending before Supreme Court)?

Court’s Observations (Paras 5–11)

• The Court noted that challenges to these notifications are pending before the Supreme Court in M/s HCC-SEW-MEIL-AAG JV v. Assistant Commissioner of State Tax & Ors. (SLP 4240/2025) and before itself in Engineers India Ltd. v. Union of India. Hence, the validity of notifications was not adjudicated.

• On facts, the adjudication order explicitly recorded reasons: the taxpayer’s reply lacked documentary support. Thus, the order could not be termed as mechanical.

• Judicial review under Article 226 is limited; adequacy of evidence is not for writ courts to re-examine. Proper remedy is appeal under Section 107 CGST Act.

Judgment (Paras 12–17)

• The High Court refused to interfere with the adjudication order.

• The petitioner was granted time till 15th July 2025 to file an appeal under Section 107 CGST Act along with mandatory pre-deposit.

• The appeal, if filed, shall not be rejected on limitation and must be heard on merits.

• The issue of validity of Notifications 9/2023 and 56/2023 was left open, to be governed by the Supreme Court’s final verdict in SLP 4240/2025 and Delhi High Court’s pending decision in Engineers India Ltd.

Table of Precedents Referred

Between Fine Lines

For businesses, this judgment clarifies that once a reply is considered but found deficient in evidence, writ petitions are not a substitute for statutory appeal under Section 107. The appellate mechanism remains the correct route. Importantly, the fate of limitation-extension Notifications 9/2023 and 56/2023 under Section 168A will depend on the Supreme Court’s final say, which will have pan-India implications for pending GST adjudications.

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