SCN And Order Passed During GST Registration Suspension: Delhi
High Court Provides Relief Despite Limitation
Introduction
The Delhi High Court’s
decision in AB Players Exports Pvt. Ltd. v. Commissioner, State Tax (Delhi
GST) is a significant ruling that underscores the judiciary’s willingness
to balance procedural delays with substantive justice. The matter
revolved around whether the petitioner, who approached the court belatedly
against adverse orders under the GST regime, could still be granted an
opportunity to pursue statutory remedies.
The judgment, delivered
on 5 August 2025, demonstrates how courts are adopting a practical
approach in GST disputes, particularly when taxpayers establish bona
fide reasons for delay, such as technical issues on the GST portal or
suspension of registration.
Case
Details
- Case Title:
AB Players Exports Pvt. Ltd. v. Commissioner, State Tax (Delhi GST)
- Case No.:
W.P.(C) 11620/2025, CM APPL. 47569/2025 & CM APPL. 47570/2025
- Court:
High Court of Delhi at New Delhi
- Date of Order:
05 August 2025
- Subject Matter:
Challenge to Orders-in-Original dated 05 April 2024 and 23 August 2024
passed by the Sales Tax Officer Class II, raising demands on grounds of
ineligible ITC, ITC claimed from cancelled dealers, and related
discrepancies.
Summary of
the Case
The petitioner challenged
two Orders-in-Original dated 5 April 2024 and 23 August 2024 passed by
the Delhi GST Department, which confirmed tax demands based on alleged ineligible
input tax credit (ITC) and ITC availed from cancelled dealers. These orders
stemmed from two Show Cause Notices (SCNs) dated 15 December 2023 and 27
May 2024.
The petitioner argued
that these SCNs never came to its notice due to suspension of its GST
registration, which limited portal access. It was only while pursuing a related
writ petition (W.P.(C) 6683/2025) before the Delhi High Court in May 2025 that
its counsel discovered the existence of the earlier SCNs and orders.
The respondent contended
that the petitioner had approached the court with significant delay, making the
writ petition untenable since statutory appeal remedies existed.
Balancing both sides, the
Court accepted the petitioner’s bona fide explanation for delay,
permitted the company to file an appeal by 30 September 2025, and
directed that if such appeal was filed with requisite pre-deposit, it would not
be dismissed on limitation grounds.
Facts of
the Case
1. Issuance
of SCNs:
o SCN
dated 15 December 2023 and another dated 27 May 2024 were issued
by the Department alleging wrongful ITC claims by the petitioner.
o Grounds
included ITC availed on cancelled dealers and ineligible ITC
under GST provisions.
2. Orders-in-Original:
o Based
on the SCNs, two Orders-in-Original were passed:
§ 05
April 2024
§ 23
August 2024
o Both
confirmed tax demands against the petitioner.
3. Petitioner’s
Knowledge:
o The
petitioner’s GST registration was suspended on 25 April 2023 following
an SCN.
o Consequently,
the company did not access the GST portal regularly.
o The
petitioner only became aware of these SCNs and OIOs in May 2025, while
contesting a third SCN issued by the Central Authority before the High Court in
W.P.(C) 6683/2025.
4. Present
Writ:
o The
petitioner filed the present writ petition in August 2025, challenging
the OIOs dated April and August 2024.
Submissions
by the Petitioner
The petitioner, through
counsel, argued:
- Lack of Knowledge of SCNs:
The two SCNs dated December 2023 and May 2024 never came to its knowledge
due to suspension of GST registration and portal access issues.
- Portal Limitations:
The SCN dated 15 December 2023 was only visible under the “Additional
Notices Tab,” which was not easily accessible.
- Reliance on Earlier Court Order:
The petitioner relied on the Delhi High Court’s earlier order dated 19
May 2025 in W.P.(C) 6683/2025 (AB Players Exports Pvt. Ltd. v.
Commissioner, CGST, Delhi West), where similar reliefs had been
granted in relation to a different SCN.
- Bona Fide Conduct:
The petitioner’s conduct was bona fide, as it had no deliberate intention
to evade proceedings. Delay occurred due to technical and procedural
barriers.
- Prayer:
Quashing of the impugned OIOs dated 05 April 2024 and 23 August 2024.
Submissions
by the Respondent
The Department, through
counsel, countered:
- Appealable Orders:
The impugned OIOs are appealable under the GST Act, and writ
jurisdiction should not be invoked bypassing statutory remedies.
- Delay in Approach:
The petitioner waited more than a year after passing of the OIOs to file
this writ, which itself is sufficient reason for dismissal.
- Portal Accessibility:
The portal remained accessible even during suspension of registration. The
petitioner could have accessed the SCNs if it had exercised due diligence.
- Lack of Grounds for Writ:
No exceptional circumstances exist to justify invoking Article 226. The
writ should be dismissed at threshold.
Observations
of the Court
The Division Bench made
the following key observations:
1. Delay
in Filing: Indeed, the petitioner had approached the court with
a delay of more than one year after the OIOs were passed. Ordinarily,
such delay would not be condoned.
2. Petitioner’s
Explanation: However, the Court accepted the
explanation that the petitioner’s lawyers discovered the SCNs and OIOs only
while complying with directions in another writ petition (W.P.(C) 6683/2025).
3. Bona
Fide Conduct: The Court considered the explanation bona
fide and not a deliberate attempt to bypass remedies.
4. Statutory
Remedy of Appeal: The OIOs are appealable. Hence, instead
of entertaining the writ, the Court directed the petitioner to file an appeal.
5. Relief
Despite Delay: As a matter of equity, the Court
directed that if the appeal is filed by 30 September 2025, it shall not
be dismissed on the ground of limitation and will be heard on merits.
Final
Judgment
The Delhi High Court
disposed of the writ petition with the following directions:
- The petitioner is permitted to file
an appeal against the OIOs dated 05 April 2024 and 23 August 2024
by 30 September 2025.
- The appeal shall be entertained without
dismissal on limitation grounds, provided requisite pre-deposits are
made.
- The matter shall be heard on merits
by the appellate authority.
- All rights and remedies of the
parties were kept open.
- Pending applications were also
disposed of.
Conclusion
The judgment in AB
Players Exports Pvt. Ltd. v. Commissioner, Delhi GST highlights several
important legal principles:
1. Balance
Between Procedural Delay and Substantive Justice:
Courts will not permit taxpayers to abuse delay, but where genuine and bona
fide reasons exist, relief will be granted to preserve substantive rights.
2. Importance
of GST Portal Vigilance: Taxpayers must regularly monitor
the GST portal, even during suspension of registration, as SCNs and orders
continue to be uploaded there.
3. Scope
of Writ Jurisdiction: High Courts remain reluctant to
entertain writs against appealable orders but will Mold relief to ensure that
taxpayers are not unfairly prejudiced due to technicalities.
4. Practical
Relief: By directing that the appeal filed by 30 September
2025 will not be barred by limitation, the Court ensured both compliance with
procedure and protection of taxpayer rights.
Disclaimer: All the Information is based on the notification, circular advisory and order issued by the Govt. authority and judgement delivered by the court or the authority information is strictly for educational purposes and on the basis of our best understanding of laws & not binding on anyone.
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