Portal-Only GST Notices: Madras HC Reopens Trader’s Case On 25% Deposit, Orders Bank Account Unfrozen And Directs Officers To Explore Other Service Modes

In brief

The question

1. Whether the assessment order should be set aside where the notices were uploaded to the GST portal, but the petitioner was not afforded a personal hearing and the notices were not effectively brought to her attention.

The court held

The Court set aside the assessment order dated 10 February 2025, with the setting aside to take effect upon the petitioner’s payment of 25% of the disputed tax within four weeks of receiving the order.

It also directed

The petitioner must file her reply and supporting documents within three weeks of payment; the respondent must then give 14 days’ clear notice of a personal hearing and decide the matter afresh on the merits and in accordance with law.

The Court also directed the bank to defreeze the petitioner’s account upon production of the order.

The writ petition was disposed of without costs.

01Facts

The petitioner, proprietor of BMR Traders, challenged an assessment order in Form GST DRC-07 dated 10 February 2025.

p. 1

Her GST registration had been cancelled with effect from 30 April 2024, and she said she had not received effective notice of subsequent proceedings or an opportunity to submit a reply and supporting material.

pp. 1–4

The State submitted that notices were uploaded on the GST portal, but accepted that no personal hearing had been provided; it sought remand subject to the petitioner depositing 25% of the disputed tax.

pp. 1–4

The petitioner agreed to make that deposit.

p. 2, 5

02Issues

i.1. Whether the assessment order should be set aside where the notices were uploaded to the GST portal, but the petitioner was not afforded a personal hearing and the notices were not effectively brought to her attention.

pp. 3–5

ii.2. Whether remand could be ordered subject to a deposit of 25% of the disputed tax, and whether the bank-account attachment should remain in force.

p. 5

03Law Applied

Article 226 of the Constitution empowers the High Court to grant appropriate relief where an assessment process violates natural justice.

p. 2, 5

Section 75(4) of the GST Act requires an opportunity of personal hearing in the circumstances addressed by the Court; the judgment records the absence of such a hearing as a breach of natural justice.

p. 2, 5

Section 169(1) provides for legally recognised modes of service.

pp. 3–4

Although portal-upload service is sufficient, where a taxpayer does not respond to notices sent through that mode, the officer should consider other prescribed modes—preferably registered post with acknowledgement due (RPAD)—to achieve effective service rather than merely complete a formality.

pp. 3–4

The Court cited no precedent.

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

Central Goods and Services Tax Act, 2017 Section 75 Section 169

04Reasoning

The Court noted that the show-cause notice had been uploaded only to the GST portal after cancellation of the petitioner’s registration, and that the petitioner said no physical notice had been served.

pp. 3–5

More significantly, the State accepted that no personal hearing had been provided before the order was made.

pp. 3–5

The Court considered that, when portal notices drew no response, the officer should have explored other modes of service under Section 169(1), rather than proceed ex parte without an effective opportunity for the petitioner to respond.

pp. 3–4

In light of these circumstances and the petitioner’s willingness to deposit 25% of the disputed tax, the Court ordered a conditional remand.

p. 5