Opportunity Restored for Reply Amidst Pending SC Challenge on GST Limitation Extension

Case Title: Mahadev Enterprises v. Commissioner of Delhi Goods and Services Tax
Court: High Court of Delhi
Petition Number: W.P.(C) 16213/2024
Relevant Section: Section 168A of CGST Act, 2017
Category of Dispute: Limitation Extension & Natural Justice
Date of Judgment: 15 May 2025
Relevant Law: Central Goods and Services Tax Act, 2017 – Section 73, Section 168A

🧾 Facts of the Case [¶2, ¶6, ¶7]

• The petitioner, Mahadev Enterprises, challenged a Show Cause Notice (SCN) dated 04.12.2023 and consequent demand order dated 16.04.2024 as being time-barred.

• It was contended that Notification No. 56/2023–Central Tax, which extended the limitation period, was ultra vires Section 168A of CGST Act since it was not issued under a “force majeure” situation [¶3].

• The petitioner also claimed that the SCN was uploaded only in the “Additional Notices” tab and was not effectively served [¶6].

• A reply was filed belatedly on 28.01.2024 seeking adjournment due to personal reasons, but the adjudicating authority passed an ex-parte order without granting the adjournment [¶6].

❓Question(s) in Consideration [¶3, ¶4, ¶7]

1. Whether Notification 56/2023 extending limitation under Section 168A is valid in the absence of GST Council’s prior recommendation and in post-COVID context?

2. Whether principles of natural justice were violated by not granting opportunity to file an effective reply or for a personal hearing before passing the adjudication order?

👩‍⚖️ Observation of the Court [¶4–¶10]

• The Delhi High Court took note of conflicting judgments across High Courts on Notification 56/2023 and ongoing adjudication of the issue before the Supreme Court in SLP No. 4240/2025 titled M/s HCC-SEW-MEIL-AAG JV v. Assistant Commissioner of State Tax & Ors. [¶5].

• The Court noted that the impugned notification’s validity is left open but took a prima facie view to protect taxpayer rights in the interim [¶8].

• It was also observed that the petitioner was denied the chance to participate meaningfully in the adjudication due to non-grant of adjournment [¶6–7].

🧑‍⚖️ Judgment of the Court [¶8–¶11]

• The Delhi High Court set aside the adjudication order dated 16.04.2024.

• The case was remanded to the adjudicating authority for fresh proceedings after permitting the petitioner to file a reply by 15 July 2025.

• A personal hearing was directed to be granted. The Court also ensured portal access to the petitioner for compliance.

• The Court clarified that the outcome of the remand proceedings would be subject to the final verdict of the Supreme Court on Notification 56/2023 [¶10].

🪄 Between Fine Lines

• The case reinforces the primacy of natural justice over procedural shortcuts, especially during legal ambiguity.

• Courts can grant relief independent of constitutional challenges if taxpayer participation was hindered.

• Portal notifications in isolated tabs may not suffice for service of SCNs.

• The pending SC judgment will influence finality but does not suspend taxpayer rights to be heard.

• Interim relief may be granted even when statutory provisions are under constitutional scrutiny.

📚 Summary of Referred Cases