2025 (12) TMI 1663 - HC - GST

GST portal 'Additional Notices' SCN upload and missed hearing notice led to adjudication order set aside, remanded

The dominant issue was whether an adjudication order could stand when the SCN was uploaded only under the GST portal's 'Additional Notices Tab' and did ... Service of SCN - Challenge to SCN and impugned order - vires of N/N. 9/2023- Central Tax and N/N. 56/2023- Central Tax - extension of time limitation for adjudication of SCN - HELD THAT:- As far as the issue pertaining to the ‘Additional Notices Tab’ is concerned, this Court in NEELGIRI MACHINERY THROUGH ITS PROPRIETOR MR. ANIL KUMAR VERSUS COMMISSIONER DELHI GOODS AND SERVICE TAX AND OTHERS [2025 (3) TMI 1308 - DELHI HIGH COURT] under similar circumstances where the SCN was uploaded on the ‘Additional Notices Tab’ had remanded the matter holding that 'The impugned demand orders dated 23rd April, 2024 and 5th December, 2023 are accordingly set aside. In response to show cause notices dated 04th December, 2023 and 23th September, 2023, the Petitioner shall file its replies within thirty days. The hearing notices shall now not be merely uploaded on the portal but shall also be e-mailed to the Petitioner and upon the hearing notice being received, the Petitioner would appear before the Department and make its submissions. The show cause notices shall be adjudicated in accordance with law.' There is no doubt that after 16th January, 2024, changes have been made to the GST portal and the ‘Additional Notices Tab’ has been made visible. However, in the present case, the impugned SCN was issued on 12th December, 2023 and the same does not appear to have come to the notice of the Petitioner. Under such circumstances, considering the fact that the Petitioner did not get a proper opportunity to be heard, the matter deserves to be remanded back to the concerned Adjudicating Authority - In addition, there appears to be a duplication of demand raised and the Petitioner may be even having a case to support the said contention, in view of the amendment in Section 16(4) of the CGST Act, 2017. There is however a delay in filing of the writ petition. The impugned order is set aside, subject to payment of Rs.10,000/- as cost to the Delhi High Court Bar Clerk Association - Petition disposed off by way of remand. 1. ISSUES PRESENTED AND CONSIDERED 1) Whether an ex-parte tax demand order, passed pursuant to a show cause notice and reminder allegedly not coming to the taxpayer's notice because they were uploaded on the GST portal under an 'Additional Notices' tab, should be set aside and the matter remanded for fresh adjudication to secure a fair opportunity of reply and personal hearing. 2) What consequential directions are required regarding (i) costs for delay, (ii) timeline to file reply, (iii) service/communication of hearing notice, and (iv) access to the GST portal, while keeping the challenge to the impugned notifications unresolved and making any fresh adjudication subject to pending proceedings before the Supreme Court. 2. ISSUE-WISE DETAILED ANALYSIS Issue 1: Setting aside the ex-parte demand order and remand for fresh adjudication due to lack of effective notice/opportunity Legal framework (as discussed by the Court): The Court proceeded on the requirement that adjudication should not be in default and that a noticee must receive a fair opportunity to file a reply and be heard on merits before an adverse demand is confirmed. Interpretation and reasoning: The Court noted that the show cause notice was issued before changes were made to the GST portal (post 16 January 2024) by which the 'Additional Notices' tab became visible. In the present facts, the show cause notice dated 12 December 2023 did not appear to have come to the petitioner's notice, and no reply or personal hearing participation occurred, resulting in an ex-parte order. The Court treated the absence of a 'proper opportunity to be heard' as sufficient to warrant remand, consistent with the Court's approach in similar circumstances involving portal visibility of notices. Conclusions: The Court set aside the impugned demand order and remanded the matter to the adjudicating authority for reconsideration after permitting a fresh reply and granting a personal hearing. Issue 2: Conditions and directions on remand (costs, timelines, communication mode, portal access) and treatment of notification challenge Legal framework (as discussed by the Court): The Court exercised its writ jurisdiction to impose conditions (costs) given delay, and to fashion procedural directions ensuring effective service of hearing notices and access to the portal so that the reply can be filed and the taxpayer can participate meaningfully. Interpretation and reasoning: The Court observed (without finally deciding) that there appeared to be duplication in the demand and that the petitioner 'may be' able to support its contentions including in light of the amendment to Section 16(4). However, rather than adjudicating merits, the Court considered remand appropriate to allow these contentions to be raised before the statutory authority. The Court also clarified that the challenge to the impugned notifications was not being decided and would remain subject to the Supreme Court's pending consideration; accordingly, any fresh adjudication would also remain subject to that outcome. Conclusions (operative directions): (i) The impugned order was set aside subject to payment of Rs. 10,000 as costs. (ii) Time was granted to file a fresh reply to the show cause notice by a specified date, after which the adjudicating authority must issue a personal hearing notice. (iii) The hearing notice was directed to be communicated on the specified mobile number and email address. (iv) The adjudicating authority must pass a fresh reasoned order after considering the reply and hearing submissions. (v) Access to the GST portal was directed to be provided within one week to enable uploading of the reply and access to notices/documents. (vi) The validity of the impugned notifications was expressly left open; any order on remand would be subject to the outcome of pending Supreme Court proceedings (and the related pending matter noted by the Court).