Larsen and Toubro Limited and Passavant Energy and Environment Gmbh Jv Vs Commissioner of Delhi Goods and Service Tax and Anr.

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$~20

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* IN THE HIGH COURT OF DELHI AT NEW DELHI Date of Decision: 3^rd July, 2025

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- W.P.(C) 12977/2024 & CM APPL. 54095/2024 LARSEN AND TOUBRO LIMITED AND PASSAVANT ENERGY AND ENVIRONMENT GMBH JV .....Petitioner

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Through: Mr. Rakesh Kumar, Mr. Praveen Kumar Gambhir, Mr. Deepak Kumar Prasad and Mr. Sumit Shrivastava, Advocates.

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versus

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COMMISSIONER OF DELHI GOODS AND SERVICE TAX AND ANR .....Respondents

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Through: Mr. Arun Khatri, SSC with Ms. Anushka Bhalla, Advocate for R-2 & 3.

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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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The present petition has been filed by the Petitioner under Article 226 of the Constitution of India challenging the show cause notice dated 04^th December, 2023 (hereinafter, ‘the SCN’ ) issued by the Department of Trade & Taxes, Government of N.C.T. of Delhi, pertaining to the Financial Year 2018-19, as also the consequent order dated 29th April, 2024 passed by the office of Sales Tax Officer Class II/ AVATO, Delhi (hereinafter, ‘the impugned order’ ).

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The petition also challenges the vires of Notification No. 56/2023Central Tax dated 28th December, 2023 and Notification No. 9/2023Central Tax dated 31st March, 2023 (hereinafter ‘impugned notifications’).

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Signature Not Verified

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Page 1 of 6

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W.P.(C) 12977/2024

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Signed By:NAMITA DHYANI Signing Da te:0 4.07.2025 17:46:42

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The impugned notifications were 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.’ . In the said batch of petitions, 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 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

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Signature Not Verified

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Page 2 of 6

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W.P.(C) 12977/2024

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Signed By:NAMITA DHYANI Signing Da te:0 4.07.2025 17:46:42

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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 31-32023 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 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 7-3-2025.”

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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

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Signature Not Verified

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Page 3 of 6

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W.P.(C) 12977/2024

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Signed By:NAMITA DHYANI Signing Da te:0 4.07.2025 17:46:42

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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 168A 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 SLP-4240-2025.

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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 exparte. 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

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Signature Not Verified

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Page 4 of 6

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W.P.(C) 12977/2024

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Signed By:NAMITA DHYANI Signing Da te:0 4.07.2025 17:46:42

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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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Subsequently, this Court, having noted that the validity of the central notifications— Notification Nos. 56/2023-CT and 09/2023-CT —is presently under consideration before the Hon’ble Supreme Court in S.L.P. No. 4240/2025 titled M/s HCC-SEW-MEIL-AAG JV v. Assistant Commissioner of State Tax & Ors. , had disposed of matters wherein challenge was limited to the central notifications, after addressing other factual issues raised in the respective petitions, with a direction that such matters would remain subject to the outcome of the proceedings before the Supreme Court.

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In the present case, the submission of the Petitioner, on facts, is that in the SCN, there were two grounds which are raised against the Petitioner. Firstly, there is no reconciliation between GSTR-01 and GSTR-09. Secondly, Input Tax Credit has been claimed from dealers, return defaulters and tax non payers. The demand qua the first aspect is Rs. 55,38,016/- and qua the second aspect is Rs. 61,83,610/-.

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The summary of the demand finally raised in the impugned order is to the tune of Rs. 2.38 crores. The Petitioner had also filed a rectification application wherein vide order dated 30^th July, 2024 without granting any hearing, the rectification application was dismissed.

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Under such circumstances, considering the fact that the Petitioner’s application for rectification was decided without granting a proper hearing, the matter deserves to be remanded to the concerned Authority to be

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Signature Not Verified

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Page 5 of 6

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W.P.(C) 12977/2024

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Signed By:NAMITA DHYANI Signing Da te:0 4.07.2025 17:46:42

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considered afresh.

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Let the rectification application be heard afresh by the concerned Authority, since clearly one of the grounds on which the demand has been raised in the impugned order for non-reconciliation of the GSTR-01 and GSTR-09 is that the GSTR-01 was not filed along with the reply to the SCN. However, a perusal of the record would show that the GSTR-01 was clearly available with the Adjudicating Authority itself, as is evident from the attachment to the DRC-07.

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Thus, the rectification application filed by the Petitioner is restored to its original number. The order dated 30th July, 2024, rejecting the rectification application filed by the Petitioner is set aside.

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Let the Petitioner be sent a notice of personal hearing on the following mobile number and e-mail address:

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Mobile No. - 9313457131

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E-mail - [email protected]

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Upon hearing the Petitioner, the rectification application be decided. It is made clear that no adjournment shall be granted to the Petitioner and the Petitioner shall appear on the date being fixed by the concerned Authority in the rectification application. All rights and remedies of parties are left open. 13. Accordingly, the present writ petition is disposed of. All the pending applications are also disposed of.

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PRATHIBA M. SINGH JUDGE

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RAJNEESH KUMAR GUPTA JUDGE

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JULY 3, 2025/ MR/ss

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Signature Not Verified

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Page 6 of 6

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W.P.(C) 12977/2024

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Signed By:NAMITA DHYANI Signing Da te:0 4.07.2025 17:46:42

Larsen and Toubro Limited and Passavant Energy and Environment Gmbh Jv v. Commissioner of Delhi Goods and Service Tax and Anr.

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Larsen and Toubro Limited and Passavant Energy and Environment Gmbh Jv v. Commissioner of Delhi Goods and Service Tax and Anr.

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