The Delhi High Court recently directed the Adjudicating Authority under the Central Goods and Services Tax (CGST) Act, 2017, to conduct a fresh hearing in a case where a GST demand of over ₹10 crores was raised without considering the assessee’s reply.
A division bench of Justices Prathiba M. Singh and Rajneesh Kumar Gupta passed this order while hearing a writ petition filed by M/s Perfetti Van Melle India Pvt. Ltd., a leading confectionery manufacturer in India. The company challenged the Order-in-Original dated January 6, 2025, and the GST DRC-07 summary issued later that month.
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The case revolved around whether the GST rate applicable to the company’s products was 12% or 18%. A show cause notice (SCN) demanding ₹10,86,92,372 was issued on August 4, 2024. Perfetti claimed it had filed a detailed reply on September 2, 2024, via the online portal and also submitted a hard copy the next day. However, the final order wrongly stated that no reply had been received.
The Court highlighted,
"Clearly, a substantial demand of more than Rs.10 crores has been raised without considering the stand of the Petitioner despite the fact that the reply was filed well within time way back in September, 2024 itself."
The adjudicating authority’s order mentioned that no response was filed and suggested that Perfetti purposely avoided the proceedings. However, the Court noted that personal hearing notices were returned undelivered, and there was no evidence that the company changed its address to evade notices.
The judges observed:
"Considering the fact that the reply has been completely ignored by the adjudication authority, the impugned order would not be sustainable."
Accordingly, the Court set aside the impugned order and remanded the matter for a fresh adjudication. The CGST department was directed to give three hearing dates to the Petitioner and decide the matter within three months. Notices must be uploaded on the portal, emailed, and also communicated via provided phone numbers and email addresses.
The Court also noted that two other similar cases had been decided in favor of Perfetti and allowed these precedents to be submitted before the authority during rehearing.
Finally, the Court clarified it had not examined the merits of the case and left all rights and remedies open to the parties.
Appearance: Ms. Charanya Lakshmikumaran, Mr. Yogendra Aldak, Mr. Kunal Kapoor, Mr. Yatharth Tripathi, Advocates for Petitioner; Mr. Shivam, Advocate for Mr. Jatin Singh, Advocate for Respondent
Case title: M/S Perfetti Van Melle India Pvt Ltd Additional Commissioner (Adjn.) v. CGST Delhi North & Ors
Case no.: W.P.(C) 2178/2025
