Natural justice in GST adjudication: cancelled registration and no physical notice led to setting aside the penalty order.

An adjudication order under the Uttar Pradesh GST Act was held invalid where the taxpayer's registration had already been cancelled, the registration was neither revived nor sought to be revived, and no physical or offline notice was shown to have been served before the order. In those circumstances, reliance on electronic notices alone was insufficient because the taxpayer was not expected to access the GST portal after cancellation. The court found that the essential requirements of fair notice and hearing were not met, set aside the order, and permitted fresh adjudication only after a final reply and personal hearing.

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Issues: Whether the penalty order passed under Section 122 of the Uttar Pradesh Goods and Services Tax Act, 2017 was liable to be set aside for breach of natural justice where the petitioner's GST registration had already been cancelled and no physical notice had been served.

Analysis: The registration stood cancelled with effect from 28.03.2024 and was neither revived nor sought to be revived. In those circumstances, the petitioner was not expected to access the GST portal to receive notices allegedly issued electronically for the period 2018-19. The record also did not show service of any physical or offline notice before the adjudication order was passed. The facts showed that the essential requirement of fair notice and hearing had not been satisfied, and no useful purpose would be served by keeping the writ petition pending or relegating the petitioner to alternative remedy.

Conclusion: The order dated 13.06.2024 passed under Section 122 of the Uttar Pradesh Goods and Services Tax Act, 2017 was set aside, and the petitioner was permitted to file a final reply and be afforded a personal hearing before fresh adjudication. The decision is in favour of the petitioner.

Final Conclusion: The impugned adjudication was invalid for want of compliance with the principles of natural justice, and the matter was left open for fresh decision after due opportunity to the petitioner.

Ratio Decidendi: Where a taxpayer's registration has already been cancelled and no physical notice is served, an adjudication order passed without effective notice and hearing is liable to be set aside for breach of natural justice.

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