2022 (3) TMI 86 - HC - GST

Improper Service of Show Cause Notices Through GST Portal Violates Natural Justice Under Section 169

Pushpam Reality, and S. Chandraiah Contractor, Shree Ambica Saw Mill Represented by its Proprietor Chandulal. R, Versus State Tax Officer, Hosur and others

The HC set aside GST assessment orders due to improper service of Show Cause Notices through the web portal, finding violations of natural justice ... Validity of assessment order - validity of recovery proceedings - it is alleged that the impugned assessments orders have been passed either without proper service of Show Cause Notices or without giving adequate opportunity to reply to the Show Cause Notices - violation of principles of natural justice - HELD THAT:- Though Section 169 of the respective enactments allows the authorities to communicate any decision, order, summons, notice or other communication under this Act by any one of the methods specified, unless the proper conformation that notices and impugned orders which were uploaded in the web portal of the State Government in tngst.cid.tn.gov.in are auto populated, it cannot be said that there is a sufficient compliances of the aforesaid Section. GST Act was implemented in the year 2017 with effect from 01.07.2017. The web portal maintained by GST has faced problems on several occasions and steps were taken for correcting the technical glitches. Even as on date, there are problems arising out of intercommunication between the State GST and Central GST and the web portal which has to be resolved - respondents can therefore continue the service of notice through registered post or speed post or courier with acknowledgment to the petitioners at their last known place of business or residence and upload the same in the web portal. Till all problems are resolved on the technical side, the authority may simultaneously serve the notice of assessment and communications under the Act and Rules both through registered post or speed post or courier with acknowledgment as is contemplated Section 169(1)(b) of the Act and through web portal. The impugned assessment orders are set aside - cases remanded back to the respondents to pass speaking on merits and in accordance with law - petition allowed by way of remand. Issues:Challenging assessment orders and recovery proceedings based on lack of proper service of Show Cause Notices and violation of principles of natural justice.Analysis:The petitioners challenged assessment orders and recovery proceedings due to alleged lack of proper service of Show Cause Notices or adequate opportunity to respond. The counsel for the petitioners argued that the impugned orders were passed in violation of principles of natural justice. On the contrary, the Government Advocate for the respondents contended that the notices were uploaded on the State Government's web portal and auto-populated in the GST web portal maintained by the Central Government, making them accessible to the petitioners.The Government Advocate further argued that the impugned orders could be challenged before the appellate authority under Section 107 of the respective GST enactments. Reference was made to Section 169 of the GST Acts, highlighting the various methods of service of notices deemed sufficient. The counsel for the respondents cited a decision of the Kerala High Court in support of their arguments and sought dismissal of the Writ Petitions on these grounds.Upon hearing both parties and examining the records, the court noted that while Section 169 of the GST Acts provides for different methods of communication, proper confirmation of the service of notices and orders uploaded on the State Government's web portal is essential for compliance. The court acknowledged technical issues in the GST web portal and directed the respondents to continue serving notices through registered post or courier until technical problems are resolved.The court emphasized the need for proper service of notices and ordered the remittance of cases back to the respondents for fresh assessment orders. The petitioners were instructed to respond to the Show Cause Notices, which were to be treated as supplementary notices. The court set a deadline for the respondents to pass appropriate orders within forty-five days from the date of the order, considering the Assessment Year in question.In conclusion, the court set aside the impugned assessment orders, emphasizing the importance of proper service of notices and adherence to legal procedures. The judgment aimed to ensure compliance with principles of natural justice and directed the respondents to reevaluate the cases in accordance with the law.