W.P.(C)/9626/2025 of INDIA STEEL THROUGH ITS PROPRIETOR, ANIS Vs GOVT. OF NCT OF DELHI & ORS.

*IN THE HIGH COURT OF DELHI AT NEW DELHI

Date of Decision: 8[th]August, 2025

+W.P.(C) 9626/2025 & CM APPL.40397/2025

INDIA STEEL THROUGH ITS PROPRIETOR, ANIS....PetitionerThrough:Mr. M.A. Ansari, Ms. TabbassumFirdaus, Mr. Samud Salim and Mr.Imran Ahmad, Advs. (M:971850300)

versus

GOVT. OF NCT OF DELHI & ORS......Respondents

Through:Mr. Sumit K. Batra, Advocate forGNCTD. (M: [REDACTED])Mr. Manoj Kumar Tyagi, SPC forUOI/R-4. (M:[REDACTED])Mr. Anurag Ojha, SSC, CBIC withMr. Dipak Raj Singh, Adv. for CBIC.

CORAM:JUSTICE PRATHIBA M. SINGHJUSTICE RENU BHATNAGAR

Prathiba M. Singh, J. (Oral)

1.This hearing has been done through hybrid mode.

2.The present petition has been filed by the Petitioner- India Steel throughits Proprietor, Mr. Anis under Article 226 of the Constitution of India, interalia, challenging the Show Cause Notice (hereinafter, ‘SCN’) dated 28[th]May,2024, as also the order dated 30[th]August, 2024 (hereinafter, ‘impugnedorder’) passed in respect of F.Y. 2019-20 by the office of Sales Tax OfficerClass II/ AVATO, Delhi.

3.Additionally, the present petition also challenges the vires ofNotification Nos. 56/2023 – Central Tax dated 28[th]March, 2023 and 56/2023– State Tax dated 11[th]July, 2024 (hereinafter ‘impugned notifications’)

W.P.(C) 9626/2025

4.The validity of the impugned notifications was under considerationbefore this Court in batch of petitions with the lead petition being W.P.(C)16499/2023 titled ‘DJST Traders Pvt. Ltd. vs. Union of India and Ors.’. Inthe said batch of petitions, on 22[nd]April 2025, the parties were heard at lengthqua the validity of the impugned notifications and accordingly, the followingorder was passed:

“4.Submissions have been heard in part. The broadchallenge to both sets of Notifications is on the ground thatthe proper procedure was not followed prior to theissuance of the same. In terms of Section 168A, priorrecommendation of the GST Council is essential forextending deadlines. In respect of Notification no.9, therecommendation was made prior to the issuance of thesame. However, insofar as Notification No. 56/2023(Central Tax) the challenge is that the extension wasgranted contrary to the mandate under Section 168A of theCentral Goods and Services Tax Act, 2017 and ratificationwas given subsequent to the issuance of the notification.The notification incorrectly states that it was on therecommendation of the GST Council. Insofar as theNotification No. 56 of 2023 (State Tax) is concerned, thechallenge is to the effect that the same was issued on 11thJuly, 2024 after the expiry of the limitation in terms of theNotification No.13 of 2022 (State Tax).

5.In fact, Notification Nos. 09 and 56 of 2023 (CentralTax) were challenged before various other High Courts.The Allahabad Courthas upheld the validity ofNotification no.9. The Patna High Court has upheld thevalidity of Notification no.56. Whereas, the GuwahatiHigh Courthas quashed Notification No. 56 of 2023(Central Tax).

6.The Telangana High Courtwhile not delving intothe vires of the assailed notifications, made certainobservations in respect of invalidity of Notification No. 56of 2023 (Central Tax). This judgment of the Telangana

High Court is now presently under consideration by theSupreme Court in S.L.P No 4240/2025 titled M/s HCC-SEW-MEIL-AAG JV v. Assistant Commissioner of StateTax & Ors. The Supreme Court vide order dated 21stFebruary, 2025, passed the following order in the saidcase:

“1. The subject matter of challenge before the HighCourt was to the legality, validity and propriety ofthe Notification No.13/2022 dated 5-7-2022 &Notification Nos.9 and 56 of 2023 dated 31-3-2023& 8-12-2023 respectively.Court was to the legality, validity and propriety ofthe Notification No.13/2022 dated 5-7-2022 &Notification Nos.9 and 56 of 2023 dated 31-3-2023& 8-12-2023 respectively.

2.However, in the present petition, we areconcerned with Notification Nos.9 & 56/2023 dated31-3-2023 respectively.concerned with Notification Nos.9 & 56/2023 dated31-3-2023 respectively.

3. These Notifications have been issued in thepurported exercise of power under Section 168 (A)of the Central Goods and Services Tax Act. 2017purported exercise of power under Section 168 (A)of the Central Goods and Services Tax Act. 2017

(for short, the "GST Act").

4. We have heard Dr. S. Muralidhar, the learnedSenior counsel appearing for the petitioner.Senior counsel appearing for the petitioner.

5. The issue that falls for the consideration of thisCourt is whether the time limit for adjudication ofshow cause notice and passing order under Section73 of the GST Act and SGST Act (Telangana GSTAct) for financial year 2019-2020 could have beenextended by issuing the Notifications in questionunder Section 168-A of the GST Act.Court is whether the time limit for adjudication ofshow cause notice and passing order under Section73 of the GST Act and SGST Act (Telangana GSTAct) for financial year 2019-2020 could have beenextended by issuing the Notifications in questionunder Section 168-A of the GST Act.

6. There are many other issues also arising forconsideration in this matter.

7. Dr. Muralidhar pointed out that there is acleavage of opinion amongst different High Courtsof the country. 8. Issue notice on the SLP as also onthe prayer for interim relief, returnable on 7-3-2025.”

7.In the meantime, the challenges were also pendingbefore the Bombay High Court and the Punjab andHaryana High Court. In the Punjab and Haryana HighCourt vide order dated 12th March, 2025, all the writ

petitions have been disposed of in terms of the interimorders passed therein. The operative portion of the saidorder reads as under:

“65. Almost all the issues, which have been raisedbefore us in these present connected cases and havebeen noticed hereinabove, are the subject matter ofthe Hon'ble Supreme Court in the aforesaid SLP.66. Keeping in view the judicial discipline, werefrain from giving our opinion with respect to thevires of Section 168-A of the Act as well as thenotifications issued in purported exercise of powerunder Section 168-A of the Act which have beenchallenged, and we direct that all these presentconnected cases shall be governed by the judgmentpassed by the Hon'ble Supreme Court and thedecision thereto shall be binding on these cases too.67. Since the matter is pending before the Hon'bleSupreme Court, the interim order passed in thepresent cases, would continue to operate and wouldbe governed by the final adjudication by theSupreme Court on the issues in the aforesaid SLP-4240-2025.

68. In view of the aforesaid, all these connectedcases are disposed of accordingly along withpending applications, if any.”

8.The Court has heard ld. Counsels for the partiesfor substantial period today. perusal of the abovewould show that various High Courts have taken viewand the matter is squarely now pending before theSupreme Court.

9.Apart from the challenge to the notifications itself,various counsels submit that even if the same are upheld,they would still pray for relief for the parties as thePetitioners have been unable to file replies due to severalreasons and were unable to avail of personal hearings inmost cases. In effect therefore in most cases the

-adjudication orders are passed exparte. Huge demandshave been raised and even penalties have been imposed.

10.Broadly, there are six categories of cases whicharependingbeforethisCourt.Whiletheissueconcerning the validity of the impugned notifications ispresently under consideration before the Supreme Court,this Court is of the prima facie view that, depending uponthe categories of petitions, orders can be passedaffording an opportunity to the Petitioners to place theirstand before the adjudicating authority. In some cases,proceedingsincludingappellateremediesmaybepermitted to be pursued by the Petitioners, withoutdelving into the question of the validity of the saidnotifications at this stage.

11.The said categories and proposed reliefs have beenbroadly put to the parties today. They may seekinstructions and revert by tomorrow i.e., 23rd April,2025.”

5.Thereafter, on 23[rd]April, 2025, this Court, having noted that thevalidity of the impugned notifications is under consideration before theSupreme Court, had disposed of several matters in the said batch of petitionsafter addressing other factual issues raised in the respective petitions.Additionally, while disposing of the said petitions, this Court clearly observedthat the validity of the impugned notifications therein shall be subject to theoutcome of the proceedings before the Supreme Court in S.L.P No 4240/2025titled M/s HCC-SEW-MEIL-AAG JV v. Assistant Commissioner of StateTax & Ors.

6.However, in cases where the challenge is to the parallel StateNotifications, the same have been retained for consideration by this Court.The lead matter in the said batch is W.P.(C) 9214/2024 titled Engineers India

Limited v. Union of India &Ors.

7.On facts however, the impugned order dated 30th August, 2024 raisesdemands qua the Petitioner on account of excess Input Tax Credit(hereinafter, ‘ITC’) availed and claimed ITC from the cancelled dealers. Theimpugned order arises out of SCN dated 28th May, 2024 wherein personalhearing was also fixed for 1[st]July, 2024. Thereafter, two reminders dated18th July, 2024 and 12th August, 2024 are also stated to be issued by the GSTDepartment to the Petitioner.

8.A reply dated 25[th]August, 2024 was then filed by the Petitioner inresponse to which third reminder dated 27th August, 2024 was issued by theGST Department seeking further documents from the Petitioner. Along withthe said reminder, specific documents were sought by the GST Department inrespect of certain cancelled dealers.

9.Thereafter, reply dated 30th August, 2024 was filed by the Petitioner.After consideration of the same, the impugned order has been passed raisingdemand to the tune of Rs. 2,01,03,896/- against the Petitioner.

10.In the opinion of this Court, the impugned order is reasoned order.Under these circumstances, the Court is not inclined to set aside the impugnedorder.

11.Accordingly, this Court is of the opinion that the Petitioner ought to berelegated to filing an appeal under Section 107 of the Central Goods andService Tax Act, 2017, before the Appellate Authority by 30[th]September,2025, along with the requisite pre-deposit.

12.The access to the GST portal shall be made available to the Petitionerwithin one week to download any documents which he may require.

13.If the appeal is filed by 30[th]September, 2025, it shall not be dismissed

on the ground of limitation and shall be adjudicated on merits.14.It is further made clear that the decision of the Appellate Authority shallbe subject to the decision of the Supreme Court in S.L.P. No. 4240/2025 titledM/s HCC-SEW-MEIL-AAG JV v. Assistant Commissioner of State Tax &Ors. and of this Court in W.P.(C) 9214/2024 titled ‘Engineers India Limitedv. Union of India & Ors’.

15.Accordingly, the present writ petition is disposed of in above terms. Allpending applications are also disposed of.

PRATHIBA M. SINGHJUDGE

AUGUST 8, 2025/dk/ck

RENU BHATNAGARJUDGE

W.P.(C) 9626/2025