2025 (9) TMI 1690 - HC - GST

Notices uploaded on GST portal; non-service unproven, no remand; lack of personal hearing found; petitioner directed to appeal.

HC held that notices and order were uploaded on the GST portal and the petitioner failed to prove non-service; remand to the adjudicating authority was ... Excess availment of Input Tax Credit - no date for personal hearing was provided in the SCN - Petitioner Company has not been provided an opportunity to be heard on merits - violation of principles of natural justice - HELD THAT:- The case of the Petitioner Company is that the business had shifted from Delhi to Maharashtra and the directors had also changed. This could be the reason why the Petitioner could not access the portal. However, since the notices and the impugned order was uploaded on the GST portal, the CGST Department cannot be said to be at fault. The Petitioner Company ought to have accessed the portal at the relevant time and gained knowledge of the notices. The Petitioner Company has failed to satisfy the Court that it was not served with the notices. Accordingly, the prayer of the Petitioner Company for the matter to be remanded to the adjudicating authority cannot be acceded to. Under these circumstances, since the Petitioner Company has not had the opportunity to defend itself on merits, the Court is inclined to permit the Petitioner Company to approach the Appellate Authority for availing its appellate remedy. Petition disposed off. ISSUES PRESENTED AND CONSIDERED 1. Whether the adjudicating authority's issuance of a show cause notice, personal hearing notices and order by uploading on the GST portal and sending e-mails/registered post, where the e-mail bounced back and registered post/service is disputed, amounts to denial of opportunity to be heard under principles of natural justice. 2. Whether, on the facts that the taxpayer alleges non-receipt of notices due to change of business location, change of directors and expiry of domain e-mail, the matter should be remanded to the adjudicating authority for fresh adjudication/hearing on merits. 3. Whether, and on what terms, relief in the form of extension of time for filing an appeal (despite expiration of limitation) and permission to file the appeal with requisite pre-deposit ought to be granted when the taxpayer became aware of the impugned order only after its date of issuance. ISSUE-WISE DETAILED ANALYSIS Issue 1 - Service by portal/e-mail/registered post and opportunity to be heard (legal framework) The Court examined the principles of service and right to be heard embodied in natural justice and the statutory scheme governing communication of notices and orders via the GST portal, e-mail and registered post. The framework recognizes electronic service mechanisms (portal upload and e-mail) alongside traditional modes (registered post) and imposes a duty on the taxpayer to monitor statutory electronic channels once registered. Issue 1 - Precedent Treatment The Court did not expressly identify or distinguish specific precedents in the text; it applied established administrative law tenets that a failure to receive a physical or electronic notice does not ipso facto render the service invalid where prescribed modes (portal upload) were followed and where electronic communication failed (bounced e-mail). Issue 1 - Interpretation and reasoning The Court noted that the show cause notice, hearing notice and impugned order had been uploaded on the GST portal, and the e-mail had bounced back. The Court reasoned that, since statutory communication had been effected by uploading on the portal, the department cannot be said to be at fault for the e-mail bounce. The taxpayer's change of address/registration and directors could account for inability to access the portal; given the statutory scheme and the taxpayer's continuing obligation to access the portal, absence of actual receipt did not automatically establish denial of opportunity to be heard. Issue 1 - Ratio vs. Obiter Ratio: Where notices and orders are uploaded on the GST portal in accordance with statutory procedure, failure of electronic mail delivery (bounce) does not, by itself, establish invalid service or denial of opportunity to be heard; taxpayers have a duty to access the portal and monitor their registration details. Issue 1 - Conclusion The Court concluded that the Petitioner failed to satisfy it that service had not been effected, and therefore could not demonstrate a breach of the right to be heard sufficient to set aside the impugned order on that ground alone. Issue 2 - Remand for fresh adjudication when non-receipt alleged (legal framework) The Court considered the remedial jurisdiction to remit matters for fresh adjudication where procedural infirmity (denial of hearing) is established. Remand is appropriate where prima facie there is evidence that the party was prevented from presenting its case and the adjudicatory process itself thereby suffers a real prejudice. Issue 2 - Precedent Treatment The judgment applies the general remedial principle that remand is warranted when a party can satisfactorily demonstrate non-service or denial of hearing; however, the Court found the prerequisite factual satisfaction was not met on the present record and accordingly did not follow the course of remand. Issue 2 - Interpretation and reasoning On the earlier hearing the Court observed that if the taxpayer could satisfy it of non-receipt, remand might be appropriate. Following filing of the department's affidavit showing portal upload and bounced e-mail, and given the taxpayer's unexplained migration of registration and change of directors, the Court reasoned the taxpayer had not borne the burden of proving non-service. In those circumstances a remand was not warranted because the factual predicate for remand (clear non-service) was absent. Issue 2 - Ratio vs. Obiter Ratio: Remand to the adjudicating authority is discretionary and depends on the taxpayer establishing non-service or denial of opportunity to be heard; absent satisfactory proof of non-service where portal upload occurred, remand is not mandated. Issue 2 - Conclusion The Court declined to remit the matter to the adjudicating authority because the Petitioner failed to satisfy the Court that notices had not been served or that it was denied an opportunity to be heard on the merits. Issue 3 - Extension of limitation to file appeal and grant of indulgence to approach appellate authority (legal framework) The Court considered its equitable and supervisory power to grant relief from limitation where a party becomes aware of an order after its issuance and where procedural fairness considerations make it just to allow an appeal to proceed, subject to appropriate conditions such as pre-deposit and time limits to prevent prejudice to revenue. Issue 3 - Precedent Treatment The Court exercised a discretionary remedial relief consistent with principles permitting condonation or an extension where delay is excusable or ignorance of the order is established; rather than remanding on merits, the Court directed that appellate remedy be kept open for adjudication on merits notwithstanding limitation. Issue 3 - Interpretation and reasoning Although the limitation for appeal had expired, the taxpayer only became aware of the impugned order upon visiting the department several months later. Balancing the absence of a finding of non-service against the lack of opportunity to defend on merits, the Court permitted the taxpayer to file an appeal by a fixed date (31 October 2025) along with necessary pre-deposit, and ordered that the appeal shall not be dismissed on the ground of limitation and shall be entertained and adjudicated on merits if filed within the stipulated period. Issue 3 - Ratio vs. Obiter Ratio: Where a taxpayer acquires knowledge of an adjudicatory order after its issuance and where it has not had the opportunity to defend on merits, the Court may, in the exercise of its discretion, permit filing of an appeal despite expiration of the limitation period on specified conditions (filing by a fixed date and requisite pre-deposit), without deciding the merits. Issue 3 - Conclusion The Court granted conditional relief by extending time for filing an appeal to a specified date with necessary pre-deposit, directed that such appeal shall be entertained on merits and shall not be dismissed on the ground of limitation, while emphasizing that its observations shall not prejudice final adjudication. Cross-references and Final Observations The Court's conclusions on Issues 1 and 2 are interlinked: finding service by portal upload and a bounced e-mail negated a factual basis for remand, yet equitable considerations prompted the relief under Issue 3 to enable the taxpayer to seek appellate adjudication. The Court expressly stated that its observations shall not have any bearing on the final adjudication on merits by the appellate authority.