CA Aarchana Yadav

Delhi High Court: A show-cause notice generated internally but communicated after the limitation period is time-barred. M/s Sikka Motors Pvt. Ltd. v. Union of India [WP (C) 5076/2025 | 2026:DHC:9438-DB | 27-Oct-2026]

GST demand confirmed by casually calling the taxpayer’s reply "unsatisfactory" without recording any reasons: High Court steps in and quashes the unreasoned order! Issue: Whether an adjudication order determining tax liability under Section 73 of the Punjab Goods and Services Tax Act, 2017 is legally sustainable when the Department rejects the Assessee's reply to a Show Cause Notice by merely recording that the explanation was "not found satisfactory", without assigning independent reasons. Rule: Under settled principles of administrative law and the statutory framework of Section 73 of the Goods and Services Tax Act, 2017, an adjudicating officer exercises quasi-judicial functions. Recording clear, cogent reasons is the soul of any quasi-judicial determination, and the authority must expressly deal with the specific points raised by the noticee rather than resorting to cryptic, mechanical rejections. Application: The Assessee was served with a Show Cause Notice under Section 73, to which a detailed written response was submitted. The Department proceeded to confirm the tax demand through a summary order, simply recording that the Assessee's explanation was "not found satisfactory." Upon a challenge before the High Court, the Department’s counsel could not demonstrate that the reply was ever evaluated on its merits. Because an adjudicating authority cannot discard a factual defence without evaluating the contentions, and because reasons form the indispensable backbone of quasi-judicial discipline, such a non-speaking determination fails the basic test of fairness and legal validity. Conclusion: The High Court allowed the writ petition, quashed the impugned assessment order, and remitted the matter back to the adjudicating authority to pass a fresh, reasoned order on merits in accordance with law. Impact Analysis: This judgment reins in mechanical, copy-paste GST demand orders, establishing that officers cannot brush aside an Assessee's reply with vague labels like "not satisfactory" without writing down the actual reasoning. Title: VISHAL JEWELLERS vs. STATE OF PUNJAB Court: THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH Citation: CWP-6678-2026 (O&M) Dated: 08-07-2026