Delhi High Court
M/S Mathur Polymers vs Union Of India & Ors on 26 August, 2025
Author: Prathiba M. Singh
Bench: Prathiba M. Singh
$~5
* IN THE HIGH COURT OF DELHI AT NEW DELHI
Date of Decision: 26th August, 2025
+ W.P.(C) 2394/2025 & CM APPL. 11289/2025
M/S MATHUR POLYMERS .....Petitioner
Through: Mr. Akhil Krishan Maggu, Mr. Vikas
Sareen, Mr. Aryan Nagpal, Advs.
versus
UNION OF INDIA & ORS. .....Respondents
Through: Mr. Gibran Naushad, SSC with Mr.
Harsh Singhal and Mr. Suraj Shekhar
Singh, Advs.
CORAM:
JUSTICE PRATHIBA M. SINGH
JUSTICE SHAIL JAIN
JUDGMENT
Prathiba M. Singh, J.
1. This hearing has been done through hybrid mode.
2. The present petition has been filed by the Petitioner under Articles 226
& 227 of the Constitution of India seeking to set aside the impugned Order-
in-Original dated 02nd February, 2025 passed by Respondent No. 3. The
impugned order is challenged, inter alia, on the ground that the notices for
personal hearing were not received by the Petitioner.
3. On previous dates of hearing, i.e., 10th March, 2025 and 17th April,
2025, the CGST Department was directed to place on record any documents
to show that the personal hearing notices have been given to the Petitioner in
this matter.
4. A set of documents, along with an affidavit, has been placed on record
by the CGST Department. Mr. Gibran Naushad, ld. Counsel for the CGST
Department has shown to the Court that there were three opportunities for
Signature Not Verified
Digitally Signed W.P.(C) 2394/2025 Page 1 of 11
By:RAHUL
Signing Date:28.08.2025
15:18:38
hearing which were given to the Petitioner vide two hearing notices.
5. For the first hearing on 16th January, 2025, an e-mail was sent to the
registered e-mail address provided by the Petitioner. The e-mail dated 13th
January, 2025, sent at 16:33 hrs to [email protected], which is the
registered e-mail address of the Petitioner in the Goods and Services Tax
(hereinafter, ‘GST’) portal has been placed on record. The second notice
fixing the dates for personal hearing on 23rd January, 2025 and 29th January,
2025, was sent by e-mail to the same e-mail address i.e.,
[email protected] on 18th January, 2025 at 05:44 p.m.
6. The GST portal of the Petitioner is relevant and is extracted below:
Signature Not Verified
Digitally Signed W.P.(C) 2394/2025 Page 2 of 11
By:RAHUL
Signing Date:28.08.2025
15:18:38
7. A perusal of the above GST portal of the Petitioner would show that the
Petitioner is a proprietary concern of Smt. Suman Mathur who has given the
registered mobile number as ‘9910208368’. The registered e-mail address is
‘[email protected]‘.
8. Insofar as the authorised signatory is concerned, the name is mentioned
as Suman Mathur and under the heading of ‘name & contact of GST
practitioner’, ‘NA, NA’ has been provided.
9. Thus, the e-mail address which has been provided on the GST portal is
presumed to be the registered email of the proprietor itself and is not reflected
merely as a GST practitioner or consultant’s e-mail.
10. In fact, the writ petition is conspicuously silent on this fact that the e-
mails for personal hearing were sent to the Petitioner’s registered e-mail
address.
11. Be that as it may, under Section 169(1)(c) of the Central Goods and
Service Tax Act, 2017 (hereinafter, ‘the Act’), a communication sent to an e-
mail address provided at the time of GST registration is adequate service of a
decision, order, summons or notice or any other communication. Relevant
portion of the said provision is extracted hereunder:
“169. Service of notice in certain circumstances.–(1) Any
decision, order, summons, notice or other communication under
this Act or the rules made thereunder shall be served by any one
of the following methods, namely:–
xxxx
(c) by sending a communication to his e-mail address provided
at the time of registration or as amended from time to time..”
12. Ld. Counsel for the Petitioner relies upon Mrs. Neelam Ajit Phatarpekar
vs. Assistant Commissioner of Income Tax, Tax Appeal No. 2756 of 2024 to
Signature Not Verified
Digitally Signed W.P.(C) 2394/2025 Page 3 of 11
By:RAHUL
Signing Date:28.08.2025
15:18:38
argue that a notice given to the Chartered Accountant would not be sufficient
notice under the Income Tax Act, 1961.
13. Insofar as this issue is concerned, the Court is of the view that the
language in the Income Tax Act and in the CGST Act is different. With respect
to Section169 of the Act, this Court has also taken a view recently in W.P. (C)
4374/2025 titled Rishi Enterprises through its Proprietor v. Additional
Commissioner Central Tax Delhi, North & Anr. that communication on the e-
mail address is sufficient communication. The relevant part of the order reads
as under:
32. A perusal of the above provision would show that
the service can be effected either –
(i) through physical tendering, or
(ii) by registered post or speed post or courier with
acknowledgment due, or
(iii) by a communication to the email address, or
(iv) uploading on the common portal, or
(v) by publication in a newspaper or by affixation.
It is not in dispute that service can be effected by any one of
the above modes under Section 169 of Act. However, ld.
Counsel for the Petitioner raises an interesting issue under
Section 169(2) that ‘deemed service’ only would be in case of
service, which is under Section 169(1)(a), 169(1)(e) or
169(1)(f) of the Act in view of the terms ‘tendered’ or
‘published’ or ‘affixed’ being used in said subsection. The
Petitioner’s contention is that no ‘deemed service’ can be
attributed where service is effected through the modes
prescribed under the remaining sub-clauses.
33. Insofar as this argument is concerned, the Court has
no doubt as to the fact that ‘limitation’ and ‘service’ are
interlinked with each other. Therefore, the term issuance of
an order has to be interpreted in the context of Section 169 of
the Act and Rule 142 of the CGST Rules. Under the scheme
of Section 169 of the Act the usual modes of service are
stipulated and some modes of service are also construed as
Signature Not Verified
Digitally Signed W.P.(C) 2394/2025 Page 4 of 11
By:RAHUL
Signing Date:28.08.2025
15:18:38
‘deemed service’ under Section 169(2). The usual modes of
service could be physical service, registered post, speed post,
courier, email, uploading on the common portal, affixation
etc., In the case of some modes of service, the service is
deemed to have been effected. However, it cannot be argued
or held that only when the service is done by any of the
deemed service modes, that the order would stand issued. The
issuance of the order in any of the stipulated modes of service
would constitute service. There is a difference between
issuance of an order and deemed service under Section
169(2) of the Act. Issuance of the order is what is required
under Section 74(10) of the Act and service through a mode
which would constitute deemed service of the order is not
mandated. Therefore, communicating an order by email
would be sufficient service in terms of Section 169 of Act for
constituting issuance of an order. Rule 142 is also clear in
the initial portion where it uses the expression, summary of
the order issued under Section 74 of the Act.
14. Thus, in this case, the Court is satisfied that by both the e-mails, the
proper hearing notices have been given to the Petitioner.
15. The second issue that is being raised herein is in respect of Section
74(10) of the Act, stating that a combined Show Cause Notice and order cannot
be given and separate orders have to be passed in respect of separate financial
years.
16. In support of the said submission, reliance is placed upon by the
Petitioner on the decision of the Supreme Court in State of Jammu and
Kashmir and Others Versus Caltex (India) Ltd. 1965 SCC OnLine SC 168,
wherein reference was also made to the decision in Bennet and White
(Calgary) Ltd. v. Municipal District of Sugar City No. 5, [1953] S.C.R. 1069.
17. The judicial committee, in Bennet & White (supra) observed that when
the assessment is not for an entire sum but for separate sums, the same ought
Signature Not Verified
Digitally Signed W.P.(C) 2394/2025 Page 5 of 11
By:RAHUL
Signing Date:28.08.2025
15:18:38
to be dissected and earmarked, each to a separate assessable item. The said
decisions were, however, rendered in the context of sales tax.
18. In the case of Caltex (India) (supra), there was one assessment order
passed from the period January, 1, 1955 to May, 1959, but the assessment could
be easily split up and dissected and the items of sales could be separated and
taxed for different periods. Hence, the Supreme Court held that in such a case,
the assessment for the period from January 1, 1955 to September 6, 1955 can
be separated from the assessment of the rest of the period.
19. However, the decision in Caltex (India)(supra) cannot be applied to the
facts in the present case, since the case in hand pertains to allegations of
fraudulent availment of Input Tax Credit (hereinafter, ‘ITC’). The impugned
order contains the record of a long drawn investigation over a period of time
which led to the confirmation of tax demand of ITC amounting to Rs.
81,54,990/-.
20. Another decision relied upon by the Petitioner is W.P. No. 33164 of 2023
titled Titan Company Ltd. v. Joint Commissioner of GST & Central Excise.
In the said case, the issue of bunching of Show Cause Notices (SCNs) was
considered by the Madras High Court and the Court was of the opinion that
under Section 73, Central Goods and Service Tax Act, 2017, bunching of SCNs
would not be permissible.
21. Heard. This Court has, in the past, considered several orders-in original
involving demands on the ground of allegations of fraudulent availment of ITC
and has held that there are several factual issues in such cases, which would
need to be looked into, which cannot be adjudicated in a writ petition. In the
decision of W.P.(C) 4853/2025 titled Ambika Traders through Proprietor v.
Additional Commissioner, Adjudication, DGGSTI, CGST Delhi North, in the
Signature Not Verified
Digitally Signed W.P.(C) 2394/2025 Page 6 of 11
By:RAHUL
Signing Date:28.08.2025
15:18:38
context of issuance of multiple consolidated SCNs and passing of a
consolidated order, this Court observed as under:
43. Insofar as the issue of consolidated notice for
various financial years is concerned, a perusal of Section 74
of the CGST Act would itself show that at least insofar as
fraudulently availed or utilized ITC is concerned, the
language used in Section 74(3) of the CGST Act and Section
74(4) of the CGST Act is “for any period” and “for such
periods” respectively. This contemplates that a notice can be
issued for a period which could be more than one financial
year. Similar is the language even in Section 73 of the CGST
Act. The relevant provisions read as under:
“73. Determination of tax [, pertaining to the period
up to Financial Year 2023-24,] not paid or short paid
or erroneously refunded or input tax credit wrongly
availed or utilised for any reason other than fraud or
any wilful-misstatement or suppression of facts.–
XXXX
(3) Where a notice has been issued for any period under
sub-section (1), the proper officer may serve a
statement, containing the details of tax not paid or short
paid or erroneously refunded or input tax credit
wrongly availed or utilised for such periods other than
those covered under sub-section (1), on the person
chargeable with tax.
(4) The service of such statement shall be deemed to be
service of notice on such person under sub-section (1),
subject to the condition that the grounds relied upon for
such tax periods other than those covered under sub-
section (1) are the same as are mentioned in the earlier
notice.
XXXX
74. Determination of tax [, pertaining to the period up
to Financial Year 2023-24,] not paid or short paid or
erroneously refunded or input tax credit wrongly
availed or utilised by reason of fraud or any wilful-
misstatement or suppression of facts.–
Signature Not Verified
Digitally Signed W.P.(C) 2394/2025 Page 7 of 11
By:RAHUL
Signing Date:28.08.2025
15:18:38
XXXX
(3) Where a notice has been issued for any period under
sub-section (1), the proper officer may serve a
statement, containing the details of tax not paid or short
paid or erroneously refunded or input tax credit
wrongly availed or utilised for such periods other than
those covered under sub-section (1), on the person
chargeable with tax.
(4) The service of statement under sub-section (3) shall
be deemed to be service of notice under sub-section (1)
of section 73, subject to the condition that the grounds
relied upon in the said statement, except the ground of
fraud, or any wilful-misstatement or suppression of facts
to evade tax, for periods other than those covered under
sub-section (1) are the same as are mentioned in the
earlier notice.”
44. Some of the other provisions of the CGST Act, which
are relevant, include Section 2(106) of the CGST Act, which
defines “tax period” as under:
“2.[…] (106) “tax period” means the period for which
the return is required to be furnished”
45. Thus, Sections 74(3), 74(4), 73(3) and 73(4) of the
CGST Act use the term “for any period” and “for such
periods”. This would be in contrast with the language used
in Sections 73(10) and 74(10) of the CGST Act where the term
“financial year” is used. The said provisions read as under:
“73.[…] (10) The proper officer shall issue the order
under sub-section (9) within three years from the due
date for furnishing of annual return for the financial
year to which the tax not paid or short paid or input tax
credit wrongly availed or utilised relates to or within
three years from the date of erroneous refund”
“74.[…] 10) The proper officer shall issue the order
under sub-section (9) within a period of five years from
the due date for furnishing of annual return for the
financial year to which the tax not paid or short paid orSignature Not Verified
Digitally Signed W.P.(C) 2394/2025 Page 8 of 11
By:RAHUL
Signing Date:28.08.2025
15:18:38
input tax credit wrongly availed or utilised relates to or
within five years from the date of erroneous refund.”
The Legislature is thus, conscious of the fact that insofar as
wrongfully availed ITC is concerned, the notice can relate to
a period and need not to be for a specific financial year.
46. The nature of ITC is such that fraudulent utilization
and availment of the same cannot be established on most
occasions without connecting transactions over different
financial years. The purchase could be shown in one
financial year and the supply may be shown in the next
financial year. It is only when either are found to be
fabricated or the firms are found to be fake that the maze of
transactions can be analysed and established as being
fraudulent or bogus.
47. A solitary availment or utilization of ITC in one
financial year may actually not be capable of by itself
establishing the pattern of fraudulent availment or
utilization. It is only when the series of transactions are
analysed, investigated, and enquired into, and a consistent
pattern is established, that the fraudulent availment and
utilization of ITC may be revealed. The language in the
abovementioned provisions i.e., the word `period’ or
`periods’ as against `financial year’ or `assessment year’ are
therefore, significant.
48. The ITC mechanism is one of the salient features of
the GST regime which was introduced to encourage genuine
businesses. In the words of Shri Pranab Mukherjee, the then
Hon’ble President of India, who addressed the Nation at the
launch of the GST on 1st July, 2017, ITC was highlighted as
one of the core features integral to the framework of the GST
regime. The relevant extract of the said speech of the Hon’ble
President is set out below:
“I am told that a key feature of the system is that buyers
will get credit for tax paid on inputs only when the seller
has actually paid taxes to the government. This creates
a strong incentive for buyers to deal with honest and
compliant sellers who pay their dues promptly.”
Signature Not Verified
Digitally Signed W.P.(C) 2394/2025 Page 9 of 11
By:RAHUL
Signing Date:28.08.2025
15:18:38
49. It is seen that the said feature of ITC has been
misused by large number of unscrupulous dealers, businesses
who have in fact utilized or availed of ITC through non-
existent supplies/purchases, fake firms and non-existent
entities. The ultimate beneficiary of the ITC in the most cases
may not even be the persons in whose name the GST
registration is obtained. Businesses, individuals, and entities
have charged commissions for passing on ITC. In several
cases, it has also been noticed that the persons in whose name
the GST registration stands are in fact domestic helps,
drivers, employees, etc., of businessmen who are engaged on
salary and who may not even be aware that their identities
are being misused.
In the above decision, the Court has fully considered the statutory scheme as
also the legislative history of the GST Act and held that in cases relating to
availment of Input Tax Credit, considering the maze of transactions and due to
the fact that the transactions may be spread over several years, issuance of a
consolidated notice for multiple Financial Years would be permissible and
tenable.
22. Thus, this Court is of the opinion that in cases involving allegations of
fraudulent availment of ITC, where the transactions are spread across several
years, a consolidated notice may in fact be required in such cases in order to
establish the illegal modality adopted by such businesses and entities. The
language of the legislation, itself, does not prevent issuance of SCN or order
for multiple years in a consolidated manner.
23. Thus, this Court is of the opinion that on both the contentions made by
the Petitioner, there is no jurisdictional error and there is also no violation of
the principles of natural justice.
Signature Not Verified
Digitally Signed W.P.(C) 2394/2025 Page 10 of 11
By:RAHUL
Signing Date:28.08.2025
15:18:38
24. Thus, the impugned order does not warrant interference under writ
jurisdiction of this Court.
25. Further, the Petitioner also had a duty to specifically plead in the writ
petition that on the registered e-mail address, notices for personal hearing were
received, which has not been done. The plea of Natural Justice was raised
vehemently, until the Department established that emails were sent. Thereafter
the plea being taken is that the emails were sent to the email address of the
Chartered Accountant. This Court has already noted above that the said email
was the registered email address of the Petitioner on the CGST portal. Thus,
the notices were rightly sent and this Court is also of the opinion that the
relevant and material facts have been concealed from the Court. The Petition is
accordingly dismissed with costs of Rs.50,000/- to be paid to the CGST
Department.
PRATHIBA M. SINGH
JUDGE
SHAIL JAIN
JUDGE
AUGUST 26, 2025/kp/ss
Signature Not Verified
Digitally Signed W.P.(C) 2394/2025 Page 11 of 11
By:RAHUL
Signing Date:28.08.2025
15:18:38
[ad_1]
Source link