After No Personal Hearing, Madras HC Reopens Mill’s GST Case If It Pays 25% Of Disputed Tax, Urging Other Notice Modes When Portal Notices Go Unanswered

In brief

The question

1. Whether the assessment order should be set aside where notices were uploaded to the GST portal, the petitioner did not respond, and no personal hearing was provided.

The court held

The Court set aside the assessment order dated 8 April 2024 and remanded the matter for fresh consideration, conditional on the petitioner paying 25% of the disputed tax within four weeks of receiving the order; the setting aside takes effect upon payment.

It also directed

The petitioner must file its reply and supporting documents within three weeks of payment.

The respondent must then provide 14 days’ clear notice fixing a personal hearing and pass a fresh order on the merits and in accordance with law.

The writ petition was disposed of without costs, and the connected miscellaneous petition was closed.

01Facts

The petitioner challenged an assessment order dated 8 April 2024, contending that notices had been uploaded under “View Additional Notices and Orders” on the GST portal and that it had not become aware of them.

pp. 2–3

The petitioner stated that it had consequently failed to reply and that no personal hearing was given before the order was passed.

pp. 2–3

The State submitted that the notices had been uploaded to the portal, but accepted that no personal hearing had been provided; it agreed to remand subject to payment of 25% of the disputed tax.

p. 3

The petitioner also undertook to pay that amount.

pp. 2–3

02Issues

i.1. Whether the assessment order should be set aside where notices were uploaded to the GST portal, the petitioner did not respond, and no personal hearing was provided.

pp. 2–4

ii.2. Whether remand for fresh consideration should be conditional on the petitioner paying 25% of the disputed tax.

p. 3, 5

03Law Applied

Section 169(1) of the GST Act recognises the prescribed modes of service of notices and orders.

p. 4

Although uploading a notice to the GST portal is a sufficient mode of service, where a taxpayer does not respond to notices sent through one mode, the officer should consider other available modes under Section 169(1), preferably registered post with acknowledgement due (RPAD), to make service effective.

p. 4

The Court also treated the absence of a personal hearing, acknowledged by the respondent, as relevant to the validity of the ex parte assessment.

pp. 3–4

Provisions in the judgment · 1

GST Act Section 169

04Reasoning

The Court accepted that portal upload constituted service, but considered that the petitioner’s lack of response called for the officer to explore other statutory modes of service rather than proceed solely on the basis of portal notices.

pp. 3–4

It found that the officer had not made sufficient efforts to serve the notices effectively and noted that the assessment had been made without a personal hearing.

pp. 3–4

In light of these circumstances and the petitioner’s undertaking to pay 25% of the disputed tax, the Court ordered remand on that condition.

p. 5