Madras HC Sets Aside GST Assessment, Remands Trader’s Case, Says Officers Should Try Other Notice Modes When Portal Notices Go Unanswered

In brief

The question

1. Whether, where the taxpayer did not respond to notices uploaded on the GST portal, the officer should have explored other modes of service under Section 169(1) of the GST Act.

The court held

The Court set aside the order dated 24 February 2023 and remitted the matter to the respondent for fresh consideration.

It also directed

It directed the petitioner to file a reply or objection, with supporting documents, within three weeks from payment of the amount referred to in the order; upon filing, the respondent must give 14 clear days’ notice fixing a personal hearing and then decide the matter on its merits and in accordance with law.

The writ petition was disposed of without costs.

01Facts

The petitioner challenged an assessment order dated 24 February 2023 under Section 74 of the Tamil Nadu Goods and Services Tax Act, 2017/Central Goods and Services Tax Act, 2017, together with the Form GST DRC-07 summary, for FY 2019–20.

p. 1

He contended that notices were uploaded to the GST portal, that he was unaware of them and did not respond in time, and that the assessment was made without a personal hearing.

p. 2

The respondent stated that the notices had been uploaded to the portal, acknowledged that no personal hearing was provided, and requested remittal.

p. 3

The petitioner also submitted that the disputed tax had already been recovered in full.

p. 2, 5

02Issues

i.1. Whether, where the taxpayer did not respond to notices uploaded on the GST portal, the officer should have explored other modes of service under Section 169(1) of the GST Act.

pp. 3–4

ii.2. Whether the assessment order should be set aside and the matter remitted where it was made without a personal hearing and the disputed tax had been recovered.

p. 3, 5

03Law Applied

Section 169(1) of the GST Act provides for valid modes of service of notices and other communications.

p. 4

The Court stated that portal service is sufficient, but where the taxpayer does not respond, the officer should consider other prescribed modes—preferably registered post with acknowledgement due (RPAD)—to make service effective.

p. 4

The Court also applied the principles of procedural fairness and an effective opportunity to be heard, holding that merely completing service formalities and proceeding ex parte may lead to avoidable litigation.

pp. 3–4

No precedent was cited.

Provisions in the judgment · 2 · Linked ones open on LawLens

Central Goods and Services Tax Act, 2017 Section 74 Section 169

04Reasoning

Although the show-cause notice had been uploaded to the GST portal, the petitioner claimed he was unaware of it and had not received the original notice; the respondent also conceded that no personal hearing was afforded.

pp. 3–4

The Court held that, given the absence of a response to portal notices, the officer should have considered another mode of service under Section 169(1), rather than proceeding to an ex parte assessment without a personal hearing.

p. 4

In light of these procedural deficiencies and the submission that the disputed tax had already been recovered, the Court considered remittal appropriate.

p. 5