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2025 (5) TMI 1203 - HC - GSTExtension of time limit of issuance of SCN u/s 73 / 74 - Validity of Notification No. 56/2023-Central Tax - procedural requirements under Section 168A for prior to the issuance of notification - Challenging the SCN and impugned order - HELD THAT - Considering the fact that the Petitioner has not been granted a proper opportunity to be heard in the opinion of the Court the matter deserves to be remanded back to the concerned Adjudicating Authority. Let a reply be filed by 10th July 2025. However it is made clear that the issue in respect of the validity of the impugned notifications is left open. Any order passed by the Adjudicating Authority shall be subject to the outcome of the decision of the Supreme Court in M/s HCC-SEW-MEIL-AAG JV v. Assistant Commissioner of State Tax Ors. 2025 (4) TMI 60 - SC ORDER . All the rights and remedies of the parties are left open. Access to the GST Portal if not already available shall be ensured to be provided to the Petitioner to enable filing of reply and access to the notices and related documents. Accordingly the impugned order is set aside and the petition is disposed of in these terms.
1. ISSUES PRESENTED and CONSIDERED
The core legal questions considered by the Court include:
2. ISSUE-WISE DETAILED ANALYSIS Validity of the Impugned Notifications under Section 168A of the GST Act The impugned Notification No. 56/2023-Central Tax, which purportedly extended the time limit for adjudication of show cause notices and passing of orders under Section 73 of the GST Act, was challenged on the ground that it was issued without prior recommendation of the GST Council, contrary to the mandatory requirement under Section 168A. The notification incorrectly stated that it was issued on the recommendation of the GST Council, whereas ratification was given only subsequent to issuance. The Court noted that this issue was already under consideration in a batch of petitions before the Court, with the lead case involving similar challenges. The Court referred to the judicial landscape where various High Courts had taken divergent views: the Allahabad and Patna High Courts upheld the validity of the impugned notifications, while the Guwahati High Court quashed Notification No. 56/2023 (Central Tax). The Telangana High Court had expressed reservations about the validity but did not conclusively decide on it. Importantly, the Supreme Court had admitted a Special Leave Petition (SLP No. 4240/2025) concerning these notifications and had issued notice with interim directions, recognizing the cleavage of opinion among High Courts. The Supreme Court was to decide if the time limits for adjudication under Section 73 of the GST Act could be extended by notifications issued under Section 168A. The Court observed that the Punjab and Haryana High Court had refrained from expressing an opinion on the vires of Section 168A and the impugned notifications, deferring to the Supreme Court's forthcoming decision and directing that interim orders continue. Thus, the Court acknowledged that the question of validity of the impugned notifications is a live and sub judice issue before the Supreme Court, and no final determination could be made in the present petition without awaiting the apex court's ruling. Procedural Fairness in Adjudication and Opportunity to be Heard Separately from the vires challenge, the Petitioner contended that the impugned adjudication order suffered from legal infirmities as it failed to consider the reply filed by the Petitioner and did not grant a proper personal hearing. The Petitioner argued that the adjudication orders were passed ex-parte, resulting in substantial demands and penalties without affording adequate opportunity to present their case. The Court examined these contentions and found merit in the grievance regarding denial of proper opportunity of hearing and non-consideration of the Petitioner's reply. It emphasized the fundamental principle of natural justice that a party must be heard before adverse orders are passed. Accordingly, the Court held that the matter deserved to be remanded to the adjudicating authority for fresh consideration. The Petitioner was directed to file a reply by 10th July 2025, and a personal hearing was to be granted. The Court also mandated that notices for the hearing be sent to the Petitioner's counsel's email address to ensure communication. The Court further ordered that access to the GST Portal must be provided to the Petitioner if not already available, to enable filing of replies and access to relevant notices and documents, thereby safeguarding procedural rights. Impact of Pending Supreme Court Proceedings The Court explicitly refrained from expressing any opinion on the validity of the impugned notifications, leaving that issue open for the Supreme Court's final adjudication. It clarified that any order passed by the adjudicating authority on remand would be subject to the outcome of the Supreme Court's decision in SLP No. 4240/2025. The Court also noted the interim orders passed by other High Courts and the Supreme Court's directions, underscoring the need for judicial discipline and consistency pending the apex court's ruling. 3. SIGNIFICANT HOLDINGS The Court's key legal reasoning and determinations include the following:
Core principles established or reaffirmed by the Court include:
Final determinations on each issue:
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