Disposed

M/S Shree Jain Polymers v. Union of India & Anr.

Delhi HC6 May 2025W.P.(C)/11180/2024

Case brief

AI extract

What is this about?

Court disposed of writ petitions challenging GST notifications while they are pending before the Supreme Court. It declined interference with impugned orders but granted liberty for appeal, extending limitation, and ensured portal access.

What did the court decide?

Petitioners granted liberty to file appeals; Appellate Authority to not dismiss appeals on limitation grounds if filed by 10 July 2025; Panels provided access to GST Portal.

M/S Shree Jain Polymers Vs Union of India & Anr. — GST and Indirect Tax | Delhi HC (2025)

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$~71 & 72

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IN THE HIGH COURT OF DELHI AT NEW DELHI

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Date of decision: 06^th May, 2025

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W.P.(C) 11131/2024 & CM APPL. 46021/2024 M/S SHREE JAIN POLYMERS .....Petitioner Through: Mr. Pranay Jain & Mr. Karan Singh, Advs. versus UNION OF INDIA & ANR. .....Respondents Through: Mr Soumava Karmakar & Ms. Jyoti Bajaj, Advs. Mr Aakarsh Srivastava, Senior Standing Counsel with Mr. Anand Pandey and Mr. Anugya Gupta, Advs. for R-1. Mr. Soumava Karmakar, Senior Panel Counsel) & Ms. Jyoti Bajaj, Adv.

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AND

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W.P.(C) 11180/2024 & CM APPL. 46233/2024 M/S SHREE JAIN POLYMERS .....Petitioner Through: Mr. Pranay Jain & Mr. Karan Singh, Advs. versus UNION OF INDIA & ANR. .....Respondents Through: Mr. K.G. Gopalakrishnan, Mr. Sumit K. Batra and Ms. Nisha Mohandas, Advs.

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CORAM: JUSTICE PRATHIBA M. SINGH JUSTICE RAJNEESH KUMAR GUPTA

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Prathiba M. Singh, J. (Oral)

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This hearing has been done through hybrid mode.

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These petitions filed under Article 226 of the Constitution of India inter

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Signature Not Verified Signed By:RAHUL Signing Date:14.05.2025 12:14:07

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W.P.(C) 11131/2024 & connected matter

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Page 1 of 7

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alia raise a challenge to the following:

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i) Show Cause Notice dated 23^rd September, 2023 in W.P.(C) 11131/2024 and Show Cause Notice dated 1^st December, 2023 in W.P.(C) 11180/2024 (hereinafter ‘ impugned SCNs ’)

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(ii) Orders dated 27th December 2023 and 26th July 2024 in W.P.(C) 11131/2024 and Orders dated 11th April 2024 and 26th July 2024 in W.P.(C) 11180/2024 ;

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The petitions also raise a challenge to Notification No.09/2023-Central Tax dated 31st March, 2023 issued by the Central Board of Indirect Taxes and Customs (hereinafter ‘ impugned notification ’).

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The impugned notification was under consideration before this Court in a batch of matters with the lead matter being W.P.(C) 16499/2023 titled ‘DJST Traders Pvt. Ltd. vs. Union of India and Ors.’ . On 22nd April, 2025, the parties were heard at length qua the validity of the impugned notifications and accordingly, the following order was passed:

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“4. Submissions have been heard in part. The broad challenge to both sets of Notifications is on the ground that the proper procedure was not followed prior to the issuance of the same. In terms of Section 168A, prior recommendation of the GST Council is essential for extending deadlines. In respect of Notification no.9, the recommendation was made prior to the issuance of the same. However, insofar as Notification No. 56/2023 (Central Tax) the challenge is that the extension was granted contrary to the mandate under Section 168A of the Central Goods and Services Tax Act, 2017 and ratification was given subsequent to the issuance of the notification. The notification incorrectly states that it was on the recommendation of the GST Council. Insofar as the Notification No. 56 of 2023 (State Tax) is concerned, the challenge is to the effect that the same

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Signature Not Verified

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W.P.(C) 11131/2024 & connected matter

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Page 2 of 7

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Signed By:RAHUL Signing Date:14.05.2025 12:14:07

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was issued on 11th July, 2024 after the expiry of the limitation in terms of the Notification No.13 of 2022 (State Tax).

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

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6. The Telangana High Court while not delving into the vires of the assailed notifications, made certain observations in respect of invalidity of Notification No. 56 of 2023 (Central Tax). This judgment of the Telangana High Court is now presently under consideration by the Supreme Court in S.L.P No 4240/2025 titled M/s HCC-SEW-MEIL-AAG JV v. Assistant Commissioner of State Tax & Ors. The Supreme Court vide order dated 21st February, 2025, passed the following order in the said case:

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

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2. However, in the present petition, we are concerned with Notification Nos.9 & 56/2023 dated 31-3-2023 respectively.

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

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

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5. The issue that falls for the consideration of this Court is whether the time limit for adjudication of show cause notice and passing order under Section 73 of the GST Act and SGST Act (Telangana GST

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Signature Not Verified

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W.P.(C) 11131/2024 & connected matter

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Page 3 of 7

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Signed By:RAHUL Signing Date:14.05.2025 12:14:07

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Act) for financial year 2019-2020 could have been extended by issuing the Notifications in question under Section 168-A of the GST Act.

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

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7. Dr. Muralidhar pointed out that there is a cleavage of opinion amongst different High Courts of the country. 8. Issue notice on the SLP as also on the prayer for interim relief, returnable on 7-32025.”

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7. In the meantime, the challenges were also pending before the Bombay High Court and the Punjab and Haryana High Court . In the Punjab and Haryana High Court vide order dated 12th March, 2025, all the writ petitions have been disposed of in terms of the interim orders passed therein. The operative portion of the said order reads as under:

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“65. Almost all the issues, which have been raised before us in these present connected cases and have been noticed hereinabove, are the subject matter of the Hon'ble Supreme Court in the aforesaid SLP.

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66. Keeping in view the judicial discipline, we refrain from giving our opinion with respect to the vires of Section 168-A of the Act as well as the notifications issued in purported exercise of power under Section 168-A of the Act which have been challenged, and we direct that all these present connected cases shall be governed by the judgment passed by the Hon'ble Supreme Court and the decision thereto shall be binding on these cases too.

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67. Since the matter is pending before the Hon'ble Supreme Court, the interim order passed in the present cases, would continue to operate and would be governed by the final adjudication by the Supreme Court on the issues in the aforesaid SLP4240-2025.

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Signature Not Verified

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Signed By:RAHUL W.P.(C) 11131/2024 & connected matter Signing Date:14.05.2025 12:14:07

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Page 4 of 7

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68. In view of the aforesaid, all these connected cases are disposed of accordingly along with pending applications, if any.”

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8. The Court has heard ld. Counsels for the parties for a substantial period today. A perusal of the above would show that various High Courts have taken a view and the matter is squarely now pending before the Supreme Court.

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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 the Petitioners have been unable to file replies due to several reasons and were unable to avail of personal hearings in most cases. In effect therefore in most cases the adjudication orders are passed ex-parte. Huge demands have been raised and even penalties have been imposed.

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10. Broadly, there are six categories of cases which are pending before this Court. While the issue concerning the validity of the impugned notifications is presently under consideration before the Supreme Court, this Court is of the prima facie view that, depending upon the categories of petitions, orders can be passed affording an opportunity to the Petitioners to place their stand before the adjudicating authority. In some cases, proceedings including appellate remedies may be permitted to be pursued by the Petitioners, without delving into the question of the validity of the said notifications at this stage.

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

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Thereafter, on 23rd April, 2025, this Court, having noted that the validity of the impugned notifications is under consideration before the Supreme Court, had disposed of several matters in the said batch of petitions

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Signature Not Verified Signed By:RAHUL Signing Date:14.05.2025 12:14:07

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W.P.(C) 11131/2024 & connected matter

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Page 5 of 7

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after addressing other factual issues raised in the respective petitions. Additionally, while disposing of the said petitions, this Court clearly observed that the validity of the impugned notifications therein shall be subject to the outcome of the proceedings before the Supreme Court.

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On facts, it is the submission of the Petitioner that it was not properly heard by the concerned authority prior to the impugned orders were passed and that its replies were not duly considered either. However, a perusal of the records reveals that the Petitioner has filed replies to the impugned SCNs. It can also be noticed that personal hearing, though granted, was not availed by the Petitioner. Further, the Petitioner is stated to have filed applications seeking rectification of the impugned orders dated 27th December 2023 and 11th April, 2024, which were rejected vide two subsequent orders, both dated 26th July, 2024.

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In view of the above circumstances, this Court is of the opinion that the impugned orders do not deserve to be interfered with. Therefore, the petitions are disposed of with liberty to the Petitioner to avail its appellate remedy along with the prescribed pre-deposit under Section 107 of the Central/Delhi Goods and Services Tax Act, 2017.

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Considering the present writ petitions were pending before this Court, during the period of limitation, if the Petitioner avails its appellate remedy by 10th July 2025, the concerned Appellate Authority shall not dismiss the appeals on the grounds of limitation and shall hear the cases on their merits and pass a comprehensive order in both the Show Cause Notices.

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All the rights and remedies of the parties are left open. Access to the GST Portal, if not already available, shall be ensured to be provided to the Petitioner to enable access to the notices and related documents.

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Signature Not Verified

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Page 6 of 7

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W.P.(C) 11131/2024 & connected matter

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Signed By:RAHUL Signing Date:14.05.2025 12:14:07

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However, it is again made clear that the issue in respect of the validity of the impugned notification is left open and the order of the appellate authority shall be subject to the outcome of the decision of the Supreme Court in S.L.P No 4240/2025 titled ‘ M/s HCC-SEW-MEIL-AAG JV v. Assistant Commissioner of State Tax & Ors ’ .

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