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Tata Projects Limited Vs Union of India & Ors. (Delhi High Court)

Date: December 8, 2025

Court: High Court
Bench: Delhi
Type: Writ Petition
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Subject Matter

Show Cause Notice Exceeding Rs 2 Crore Requires Issuance by Higher Authority

Summary

The Delhi High Court addressed a jurisdictional challenge concerning Show Cause Notices (SCNs) exceeding Rs. 2 Crores issued by an Assistant Commissioner. While allowing the SCN proceedings to continue, the Court barred the implementation of any final order without its permission, pending clarification from the GST Policy Wing on the appropriate authority.

Summary of Facts and Dispute:
  1. Impugned Action: The Assistant Commissioner/GSTO, Ward 109, (Special Zone), Zone 12, Delhi issued Show Cause Notices dated 30th September, 2025 (W.P.(C) 16888/2025) and 23rd September, 2025 (W.P.(C) 17856/2025) for demands exceeding Rs. 2,00,00,000/-.
  2. Petitioner's Argument: As per Circular No. 31/05/2018 dated 09th February, 2018, issued by the Central Board of Indirect Taxes and Customs, demands above Rs. 2,00,00,000/- ought to be issued only by an Additional Commissioner or a Joint Commissioner, not by an officer below that rank.
  3. Core Question of Law: Whether an Assistant Commissioner has the jurisdiction to issue a Show Cause Notice for a demand exceeding Rs. 2 Crores, in light of Circular No. 31/05/2018 and the reported absence of Additional Commissioners in Delhi.
Key Legal Issues & Findings:
Jurisdiction for Issuance of Show Cause Notices

The Court considered the important issue of jurisdiction for issuing Show Cause Notices.

  • Jurisdictional Threshold: The Court noted that Circular No. 31/05/2018 mandates that Show Cause Notices for demands exceeding Rs. 2 Crores must be issued by an officer of the rank of Additional Commissioner or Joint Commissioner.
  • Procedural Discrepancy: It was highlighted that the impugned SCNs were issued by an Assistant Commissioner, potentially contravening the prescribed jurisdictional limits.
  • Administrative Challenge: The Court also took cognizance of the submission that in Delhi, there is a reported absence of Additional Commissioners, which poses a practical challenge in adhering to the circular's requirements.
Ruling:
  1. Outcome: The proceedings in the Show Cause Notice dated 30th September, 2025 (W.P.(C) 16888/2025) and Show Cause Notice dated 23rd September, 2025 (W.P.(C) 17856/2025) shall continue.
  2. Directions: If a final order is passed in these proceedings, it shall not be given effect to without the prior permission of this Court. The GST Policy Wing is directed to provide clarification regarding the jurisdictional issue.
  3. Liberty: The Court awaited clarification from the GST Policy Wing to address the administrative and jurisdictional concerns raised.

FULL TEXT OF THE JUDGMENT/ORDER OF DELHI HIGH COURT

1. This hearing has been done through hybrid mode.

2. On the previous date of hearing in W. P.(C) 16888/2025 vide order dated 14th November, 2025 the following issue was raised in these two petitions:

“3. The short issue that has been raised is that, the impugned SCN has been issued by the Assistant Commissioner /GSTO, Ward 109, (Special Zone),Zone 12, Delhi. However, in terms of Circular No. 31/05/2018 dated 09th February, 2018, issued by the Central Board of Indirect Taxes and Customs, when the demand is above Rs. 2,00,00,000/-, the same ought to be issued only by the Additional Commissioner or the Joint Commissioner, and not by any officer below this rank.”

3. Today, Mr. R. Ramchandran, ld. SSC for Central Board of Indirect Taxes and Customs (hereinafter, ‘CBIC’) has handed over a letter dated 4th December, 2025, wherein, a clarification has been sought from the GST Policy Wing.

4. The issue involved in these petitions is important, in as much as, in demands exceeding Rs. 2 crores, at least in Delhi, the submission on behalf of ld. Counsels for the CBIC and Delhi GST Department is that there is no Additional Commissioner at all.

5. Let the clarification given by the GST Policy wing be placed before the Court on the next date of hearing.

6. The proceedings in the Show Cause Notice dated 30th September, 2025 in W.P.(C) 16888/2025 and Show Cause Notice dated 23rd September, 2025 in W.P.(C) 17856/2025 shall continue and if the final order is passed, the same shall not be given effect to, without the permission of this Court.

7. List on 2nd February, 2026.