COMPLIANCE OF SECTION 169 OF TAMIL NADU GST ACT, 2017 FOR SERVICE OF NOTICES

Section 169 of Tamil Nadu Goods and Service Tax Act, 2017 provides the procedure for service of notices etc.  Section 169(1) of the Act provides that any decision, order, summons, notice or other communication under this Act or the rules made thereunder shall be served by any one of the following methods-

1. by giving or tendering it directly or by a messenger including a courier to the addressee or the taxable person or to his manager or authorised representative or an advocate or a tax practitioner holding authority to appear in the proceedings on behalf of the taxable person or to a person regularly employed by him in connection with the business, or to any adult member of family residing with the taxable person; or
2. by registered post or speed post or courier with acknowledgement due, to the person for whom it is intended or his authorised representative, if any, at his last known place of business or residence; or
3. by sending a communication to his e-mail address provided at the time of registration or as amended from time to time; or
4.  by making it available on the common portal; or
5. by publication in a newspaper circulating in the locality in which the taxable person or the person to whom it is issued is last known to have resided, carried on business or personally worked for gain; or
6.  if none of the modes aforesaid is practicable, by affixing it in some conspicuous place at his last known place of business or residence and if such mode is not practicable for any reason, then by affixing a copy thereof on the notice board of the office of the concerned officer or authority who or which passed such decision or order or issued such summons or notice.

Section 169 should be read only disjunctively and not conjunctively and therefore, any modes that have been prescribed under Clause (a) to (f) if had been complied with by the Department, there can be no complaint of violation of principles of natural justice. 

Rule 52 of Tamil Nadu GST Rules provides the procedure for services of notices in the following ways-

• by giving or tendering it to such dealer or his manager or agent or the legal practitioner appointed to represent him or to his authorised representative, or
• if such dealer or his manager or agent or the legal practitioner appointed to represent him, or his authorised representative is not found, by giving or tendering it to any adult member of his family;
• if the address of such dealer is known to the assessing authority, by sending it to him by registered post; or
• if none of the modes aforesaid is practicable, by affixing it in some conspicuous place at his last known place of business or residence.

Where any Hindu undivided family, firm or other association of persons is partitioned, dissolved or discontinued, notice, summons or orders issued under the Act or these rules may be served on any member of the Hindu undivided family, any person who was a partner (not being a minor) or member of the association, as the case may be, immediately before such partition, dissolution or discontinuance.

In MR. SAHULHAMEED VERSUS THE COMMERCIAL TAX OFFICER, TUTICORIN-II, THIRUNELVELI, TAMILNADU - 2025 (1) TMI 1021 - MADRAS HIGH COURT, so many writ petitions were filed before High Court, Madras with regard to compliance of Section 169 of the Tamil Nadu Goods and Services Tax, 2017.  The High Court issued a common order for all writ petitions in the case of ‘Sahul Hameed’.  The petitioners engaged professionals for filing their returns and related works.  The mobile number and email of these practitioners were given in the GST portal.  But they failed to communicate whatever the messages received from the Department for their clients.  The main contentions of the petitioners are that the Department uploaded the show cause notices, order etc., in the portal and not by any other mode. 

The petitioners submitted the following before the High Court-

• Even though the provisions under Section 169 (1) (a) to (f) are disjunctive, they should be read conjunctively, failing which, the basic principles of natural justice would be violated. 
•  Clauses (a) to (c) of sub section (1) of Section 169 should be read as alternative.
• Section 169 (1) of the Act should be read in such a manner that it effectively complies with the principles of natural justice.

The department submitted the following before the High Court-

• The service of notice through portal had already been held to be a valid service by the High Courts.
•  Section 144B of the Income Tax Act mandates that E-mail IDs or a phone number given by the assessee for SMS alerts at the time of registration would not obliterate a notice issued through portal, as the assessee is required to visit the portal once in a month for filing its returns.
•  It  is their duty to also look at the notices that had been issued through the portal and reply properly.
• Section 169 should be read only disjunctively and not conjunctively and therefore, any modes that have been prescribed under Clause (a) to (f) if had been complied with by the Department, there can be no complaint of violation of principles of natural justice. 

The High Court considered the submissions of both the parties.  The High Court relied on some judgments by the Division Bench of Madras High Court.  In SINGARAVELAR SPINNING MILLS (P) LTD. VERSUS STATE OF TAMIL NADU AND ANOTHER - 2010 (12) TMI 1102 - MADRAS HIGH COURT, the Division Bench of Madras High Court held that a reading of rule 52(1), makes it clear that the set of expressions in the first part of rule 52(1), viz., "may be effected in any of the following ways" makes it amply clear that the service of notice on a dealer can be resorted to by any one of the modes specified in rule 52(1)(a), (b), (c). Only sub-rule 52(1)(d) specifies that if none of the modes provided under rule 52(1)(a), (b), (c) is practicable, the alternative mode of affixing notice in some conspicuous place at the last known business or residence can be resorted to. As far as the modes of service specified in rule 52(1)(a), (b), (c) are concerned, it is for the authorities concerned to resort to anyone of the modes specified therein.

The High Court also analysed the provisions of Section 169 of the Act and Rule 52.  The High Court observed that A conjoined reading of Sub-Section (1)(2) & (3) of Section 169 would amply make it clear that the State is obliged to comply with the Clauses (a) to (c) alternatively and thereafter, comply with Clauses (d) to (f). Further, even though Clause (f) has also been proceeded with the word 'or' indicating it to be disjunctive / an alternative mode of services, a reading of the Clause (f) would indicate that Clause (f) could be resorted to by the State, if any of the Clauses preceding it, was not practicable. Here also, Clause (f) makes it imperative that such affixture shall be in a conspicuous place and the last known business or residence of the asseesse. Therefore, the object of Section 169 is for strict observance of the principles of natural justice.  The High Court did not accept the contention of the Department that the GST Rules only provide for electronically issuing of notices/ summons/ orders. It is to be noted that the Rules are creature of a Statute and the Rules cannot circumscribe the mode that had been provided under the Statute. When the Statute had also mandated issuance of notice in person/ registered post/ e-mail, etc., the Rules cannot be limited to only serving it through electronic modes. Therefore, the contention that the Rules will prevail over the Statute cannot be accepted.

The High Court held that Section 169 mandates a notice in person or by registered post or to the registered e-mail ID alternatively and on a failure or impracticability of adopting any of the aforesaid modes, then the State can, in addition, make a publication of such notices/ summons/ orders in the portal/ newspaper through the concerned officials.

The High Court allowed the writ petitions.  The High Court further directed that the parties to the writ petition shall file their replies to the show cause notices, based upon which, the impugned assessment had been made, on or before 31.01.2025 and thereafter, the respective respondents shall afford an opportunity of hearing to the respective petitioners as provided under law and pass appropriate orders on merits and in accordance with law.