The Hon’ble Delhi High Court in the case of Kurlon Retail Limited v. Sales Tax Officer & Ors. [W.P.(C) 13121/2025, order dated August 28, 2025] held that where a show cause notice and reminders are only uploaded on the “Additional Notices & Orders” tab of the GST portal, without proper notice or opportunity of hearing, the resulting ex-parte adjudication order violates principles of natural justice and must be set aside. The Court remanded the matter for fresh adjudication with due opportunity, and clarified that the outcome is subject to the Supreme Court’s pending decision on the validity of extension notifications.
Facts:
Kurlon Retail Limited (“the Petitioner”) is a registered assessee under GST, facing a demand of ₹31.58 lakhs for the 2019-20 FY, involving disputed Input Tax Credit (ITC).
Sales Tax Officer & Ors. (“the Respondent”) issued a show cause notice (SCN), reminders, and adjudication order demanding the amount; these were only uploaded on the GST portal’s “Additional Notices & Orders” tab.
The Petitioner contended that the manner of notice deprived them of a fair chance to reply and be heard, as the SCN and reminders were not visible in the default notices tab and thus went unnoticed. They challenged the resulting ex parte order for natural justice violations, and also questioned the validity of Notification No. 56/2023-Central Tax and related state notifications extending limitation.
The Respondent contended that after January 16, 2024, the “Additional Notices & Orders” tab became visible to assessees, and that the Petitioner had opportunity to respond and attend a personal hearing; absence of reply or appearance justified the ex parte order.
The Petitioner filed a writ petition challenging both the order’s vires and the process, also raising the statutory challenge to the extension notification before the High Court.
Issue:
Whether an adjudication order based on a show cause notice and reminders only uploaded to the “Additional Notices & Orders” tab of the GST portal, without effective notice or opportunity to be heard, is valid?
Held:
The Hon’ble Delhi High Court in W.P.(C) 13121/2025 held as under:
- Observed that, failure to give effective notice and proper opportunity to reply or be heard, whether due to portal limitations or other reasons clearly violates the principles of natural justice.
- Noted that, although “Additional Notices & Orders” tab was made visible on the GST portal post January 16, 2024, and was accessible at the time in question, the impugned order was passed without considering any reply or submissions of the Petitioner.
- Held that, fairness requires not only notice to be uploaded in the portal, but actual notice and scheduling of a personal hearing, with notices to be sent via e-mail/mobile in addition to portal upload.
- Set aside the impugned order and granted the Petitioner time till September 30, 2025 to file a reply, with the Adjudicating Authority directed to fix a personal hearing and consider all submissions afresh.
Our Comments:
The Delhi High Court’s judgment in Kurlon Retail Limited v. Sales Tax Officer & Ors. [W.P.(C) 13121/2025, order dated August 28, 2025] came against the backdrop of judicial scrutiny concerning Notifications expressly extending limitation periods for GST adjudication, particularly Notification No. 56/2023-Central Tax dated December 28, 2023 and Notification No. 56/2023-State Tax dated July 11, 2024. These notifications purported to extend the time limits under Section 73(9) of the CGST Act, regarding adjudication of show cause notices for financial years 2018-19 and 2019-20.
The validity of such notifications has been contested across courts, giving rise to divergent rulings. The Madras High Court, in a notable case involving Ms Tata Play Limited vs Union of India [W.P.Nos.17184 of 2024 order dated June 12, 2025], declared these extension notifications ultra vires Section 168A of the CGST Act. The Court reasoned that extensions under Section 168A could be validly granted only during force majeure conditions, such as the COVID-19 pandemic, and required prior recommendation of the GST Council. The Madras High Court found that these conditions were not met, particularly, the GST Council’s recommendation was retrospective rather than contemporaneous, thus invalidating the notifications. Consequently, the Court quashed all related proceedings predicated upon such extensions.
In the case of M/s Barkataki Print and Media Services v. Union of India & Ors. [WP(C)/3585/2024 dated September 09, 2024], the Gauhati High Court declared Notification No. 56/2023 dated December 28, 2023, as ultra vires. The Court held that since the notification lacked the essential prior recommendation of the GST Council, as required by Section 168A of the CGST Act, and did not adequately demonstrate exceptional circumstances such as a force majeure event, it exceeded the authority granted by the statute. This judgment importantly protects taxpayers who relied on regulatory timelines, ensuring that administrative attempts to extend limitation periods improperly are subject to judicial review and can be invalidated.
In Siemens-Gamesa v. Deputy Commissioner of Commercial Taxes [Writ Petition No. 31388/2024 decided December 10, 2024], the Karnataka High Court stayed recovery proceedings arising from demand notices based on the contentious Notification issued under Section 168A of the CGST Act and its corresponding State notification. The Court emphasized that the extension of limitation periods without an effective and timely recommendation from the GST Council violates the legislative framework. It also highlighted that the petitioner had not exhausted legal remedies against the original refund order, citing the principles of res judicata and the constitutional guarantee of equality and fairness under Article 14. The ruling indicates judicial caution in endorsing administrative extensions of time for adjudication.
Relevant Provisions:
Section 73(9), Central Goods and Services Tax Act, 2017:
“The proper officer shall, after considering the representation, if any, made by the person chargeable with tax, determine the amount of tax, interest and penalty due from such person and issue an order within three years from the due date for furnishing the annual return for the relevant financial year.”
Section 168A, Central Goods and Services Tax Act, 2017:
“Where, in the opinion of the Government, it is necessary to do so due to force majeure or other exceptional circumstances, the Government may, on the recommendation of the Council, by notification, extend the time limit specified in, or prescribed or notified under, this Act in respect of actions specified therein.”
Notification No. 56/2023-Central Tax, dated December 28, 2023:
“….. the Government, on the recommendations of the Council, hereby, extends the time limit specified under sub- section (10) of section 73 for issuance of order under sub-section (9) of section 73 of the said Act, for recovery of tax not paid or short paid or of input tax credit wrongly availed or utilized, relating to the period as specified below, namely:–
i. for the financial year 2018-19, up to the 30th day of April, 2024;
ii. for the financial year 2019-20, up to the 31st day of August, 2024.”
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