Adjudication Without Considering Reply is Invalid: Delhi HC sets aside Sales Tax Order observing Legal Infirmities [Read Order]

The Delhi High Court recently referred to the principles of natural justice while setting aside a sales tax adjudication order on grounds that the assessing authority had failed to duly consider the petitioner’s reply and failed to grant them an opportunity of personal hearing before passing the order.

A writ petition was filed by the petitioner,  Damanpreet Singh, proprietor of M/s Ace Enterprises challenging the impugned show-cause notice (SCN) dated 04 December, 2023 issued by the office of Sales Tax Officer Class II/ AVATO, Delhi as well as the consequent order dated 6th April, 2024 passed by the Sales Tax Officer.

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The petition also challenged the vires of Notification No. 56/2023 - Central Tax dated 28th December, 2023.

The division bench of Justice Prathiba M. Singh and Justice Rajneesh Kumar Gupta observed that the validity of the impugned notifications was under consideration before this Court in a batch of petitions with the lead petition being W.P.(C) 16499/2023 titled ‘DJST Traders Pvt. Ltd. vs. Union of India and Ors. 

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In DJST Traders, the Bench had noted that the validity of the impugned notifications was under consideration before 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., and the validity of the impugned notifications therein would be strictly dependent upon the outcome of the proceedings pending before the supreme court.

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However, the Bench noted that the impugned order suffered from legal infirmities as the revenue had failed to consider the reply to SCN issued by the petitioner; another key observation was that no proper personal hearing had been granted to the petitioner.

Matters being so, the Delhi High Court ordered that the matter be remanded back to the concerned adjudicating authority while ordering that a reply be filed within 10th July, 2025.

The Delhi High Court kept open all the rights and remedies of the parties while ordering that their access to the Goods and Services Tax (GST) Portal be ensured to enable the petitioner to file their reply and access he notices and related documents.

To Read the full text of the Order CLICK HERE

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