Court directs exclusion of writ petition period for limitation calculation; overlaps in show cause notices to be examined by Appellate Authority; Supreme Court's pending judgment may benefit petitioner.
In a significant ruling delivered on October 8, 2026, the Delhi High Court (Division Bench comprising Justices Anil Kshetarpal and Bharat Parashar) refused to restore a writ petition filed by M/s Forever Exim India Private Limited challenging an adjudication order under the Central Goods and Services Tax Act, 2017 (CGST Act). The petitioner had sought restoration of Writ Petition (Civil) No. 17753 of 2024, which was disposed of earlier with consent of the counsel. The petitioner contended that the consent was wrongly recorded and sought revival of the petition.
The Court, however, held that since a statutory appeal against the impugned order dated August 30, 2024, was maintainable under Section 107 of the CGST Act, no ground existed to restore the writ petition. Instead, the petitioner was granted liberty to file an appeal against the order, along with an application for exemption from the pre-deposit requirement to the extent the tax demand overlapped with another show cause notice dated April 5, 2023.
The petitioner had raised concerns that parallel proceedings were initiated based on overlapping show cause notices issued on April 5, 2023, and August 14, 2024, potentially leading to double recovery. The Court acknowledged this issue but clarified that the question of overlap or duplicity of proceedings was within the purview of the Appellate Authority to decide.
Further, the petitioner challenged the validity of Notification Nos. 09/2023 and 56/2023 under the CGST Act. The Court observed that the validity of these notifications was already under consideration by the Supreme Court in the case of M/s HCC-SEW-MEIL-AAG JV v. Assistant Commissioner of State Tax (SLP(C) No.4240/2025). The ultimate decision by the apex court would apply to the petitioner's case if relevant.
Notably, the Court directed that if the petitioner files the appeal within two weeks from the judgment date, the period from the institution of the writ petition until the expiry of the said two weeks will be excluded for the purpose of computing limitation for filing the appeal. The Appellate Authority was also instructed to independently consider the question of limitation according to the CGST Act.
This ruling clarifies procedural aspects for taxpayers aggrieved by adjudication orders under GST, emphasizing the statutory remedy of appeal over writ petitions, and providing relief on pre-deposit in cases involving overlapping demands. It also highlights the ongoing judicial scrutiny of GST notifications at the Supreme Court level.
Bottom Line:
CGST Act - Writ petition challenging adjudication order not restored where statutory appeal under Section 107 was available - Challenge to validity of notifications already pending before Supreme Court - Petitioner permitted to file appeal with application for exemption from pre-deposit to extent of overlapping demand - Time spent in writ proceedings directed to be excluded for limitation purposes.
Statutory provision(s):
Central Goods and Services Tax Act, 2017 Section 107; Constitution of India Article 226
