GST Show Cause Notices Not Sent Physically? High Court Quashes Order for Lack of Proper Service
The Madras High Court, in one of its judgements, has held that just uploading notices on the GST portal is enough, but it is not a valid service when there are no responses from the taxpayers.
The petitioner, Selvam and Co, received a show cause notice dated 18.11.2024 and after that, three reminders dated 20.12.2024, 20.01.2025 and 29.01.2025 on the GST portal. The petitioner claims that they were unaware of these notices because these were issued on the GST Portal, and no physical copy was issued to the petitioner. Due to this, the GST tax officer passed the final order without even giving an opportunity for a hearing to the petitioner. Therefore, the petitioner approached the Madras HC to challenge the order.
The petitioner submitted that if the court sets aside this order and remands the matter to the GST authority, the petitioner will pay 25% of the disputed tax.
The High Court outlined the meaning of an effective service of the tax officer. As per the High Court, issuing notices on the GST Portal is a sufficient service, but is not an effective service when there is no response from the side of the petitioner. Passing an order in such a case would waste the time of the tax officers as well as the Appellate Authority and the court. When there are no replies from the petitioner, the officer should apply his/her mind and send notices by other modes as prescribed in Section 169(1) of the Act, preferably by way of RPAD.
The court also noted that the petitioner was not granted an opportunity for a personal hearing, which is a violation of principles of natural justice. Therefore, the court set aside the order and remanded the matter to the GST officer for fresh consideration. The court also allowed the petitioner to deposit 25% of the disputed tax within two weeks. The petitioner was directed to submit a reply along with documents within two weeks. The tax officer was directed to consider the same and issue a 14-day notice and give an opportunity for a personal hearing to the petitioner and then decide the matter.