Validity of CBIC notification u/s 168A of GST Act under Challenge: Delhi HC directs Authority to Pass order subject to Supreme Court’s Decision [Read Order]

The Delhi High Court, in the petition challenging the validity of the notification issued by the Central Board of Indirect Taxes and Customs ( CBIC ) under Section 168A of the Goods and Services Tax ( GST ) Act directed the adjudication authority to pass order subject to the decision of the Supreme Court.

The case challenged Notification Nos. 9/2023-Central Tax dated March 31, 2023, and 56/2023-Central Tax dated December 28, 2023, which extended time limits for adjudication of show cause notices under Section 73 of the GST Act. The Delhi High Court noted that similar challenges are pending before the Supreme Court. The both notifications are about extending the limitation period for order issuance under Section 73 of the GST Act for recovery.

Step by Step Handbook for Filing GST Appeals - CLICK HERE

Also read: ITR Forms Notified: Here’s What CAs Can Charge for Filing Returns by Category

The court observed that various High Courts have taken differing positions on these notifications - with Allahabad and Patna High Courts upholding their validity, while the Guwahati High Court quashed Notification No. 56. The Telangana High Court's observations questioning the validity of these notifications are currently under Supreme Court review.

Another issue raised in the petition is the challenge against the order issued under Section 73 of the GST Act. The department raised a GST demand of Rs. 4 crores on the Input Tax Credit ( ITC ) availment on grounds that the supplier’s registration was cancelled retrospectively.

Clear all Your Doubts on RCM, TCS, GTA, OIDAR, SEZ, ISD Etc... Click Here

Also read: Wind Turbine Towers Recognized as Generator Parts, Not Structures: CESTAT

While refraining from ruling on the constitutional validity of the notifications, the Delhi High Court set aside the impugned GST order issued under Section 73 and directed a fresh hearing by the adjudicating authority, allowing the petitioner 30 days to file a reply to the show cause notice.

However, the division bench of Justice Prathiba M. Singh and Justice Rajneesh Kumar Gupta  explicitly stated that any order passed by the adjudicating authority would remain "subject to the outcome of the decision of the Supreme Court."

Also read: GST Portal Glitches: A comprehensive Overview, Challenges and Mitigation Measures

To Read the full text of the Order CLICK HERE

Support our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates