High Court Quashes GST Order, GST SCN via Portal Alone Insufficient

High Court Quashes GST Order; GST SCN via Portal Alone Insufficient

The petitioner, a proprietorship firm, challenged an assessment order dated 16.04.2024 issued by the State Tax Officer under Section 73 of the TNGST/CGST Act, 2017, for the year 2018-19.

The grievance was that the show cause notice (SCN) was only uploaded on the GST portal, and no physical copy or other mode of service was used. The petitioner’s GST consultant failed to inform him about the uploaded notice, and the assessment order was passed ex parte without any personal hearing. The petitioner sought the quashing of the order, citing a violation of principles of natural justice.

Issue Raised: If the GST assessment order that was issued based only on SCNs uploaded to the GST portal, without guaranteeing efficient service or providing a face-to-face hearing, is legally valid.

HC’s Ruling: The High Court ruled that while uploading a show cause notice (SCN) on the GST portal is legally valid, it cannot be the sole method of service when the taxpayer shows no response. The Court stressed that officers must use other modes under Section 169(1) of the CGST Act, like RPAD, to ensure the notice is effectively served. Passing ex parte orders after merely uploading notices, the Court observed, amounts to “empty formalities,” violates natural justice, and clogs the judicial system with unnecessary cases.

In this case, the Court set aside the order and sent the matter back for fresh consideration. It directed the petitioner to deposit 25% of the disputed tax within four weeks, file a reply with documents in the next two weeks, and be given a clear 14-day notice for a personal hearing. The officer was ordered to pass a fresh order in accordance with law, and the writ petition was disposed of with these directions, closing the connected miscellaneous petitions.

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