GST Assessment Order Quashed for Lack of Hearing and Improper
Service of Notices
Summary of
the Case
The Madras High Court
quashed the GST assessment order passed against Tvl. Vinayak Enterprises for FY
2020–21, holding that mere portal uploads are not sufficient service
when the taxpayer is unaware. The absence of a personal hearing rendered
the order contrary to Section 75(4) of the CGST Act. The Court remanded the
matter for fresh adjudication, subject to the petitioner’s payment of 25% of
the disputed tax amount.
· Tvl.
Vinayak Enterprises v. State Tax Officer (FAC)
·
Court:
High Court of Judicature at Madras
·
Order No.:
W.P.No.24974 of 2025 & W.M.P.Nos.28138 & 28137 of 2025
Date of Order: 10.07.2025
Brief Facts
of the Case
- The petitioner received an assessment
order dated 20.11.2024 under Section 73 of the CGST Act for FY
2020–21.
- According to the petitioner, all
communications including Show Cause Notice (SCN) were only uploaded
under the “View Additional Notices and Orders” tab on the GST
portal.
- The petitioner remained unaware of
such uploads and hence did not file a reply or objection.
- Consequently, the respondent passed
an ex parte order confirming the proposals in the SCN.
- The petitioner approached the High
Court seeking quashing of the order and a direction to allow a fresh
opportunity of hearing.
Submissions
by the Petitioner
Counsel: Mr. G. Logesh
- Argued that:
- The SCN and communications were only
uploaded to the portal without any physical service, RPAD, or email.
- The petitioner was not given a
personal hearing.
- Offered to pay 25% of the disputed
tax amount as a condition for remand.
- Sought a fresh adjudication after
giving a proper opportunity to be heard.
Submissions
by the Respondent
Counsel: Mrs. K.
Vasanthamala, Government Advocate
- Conceded that:
- The notices were only uploaded on
the portal.
- No personal hearing
was granted.
- Agreed to remand the matter if the
petitioner was willing to pay 25% of the tax demand.
Court’s
View and Observations
1. Portal
Upload Alone ≠ Effective Communication
o Although
portal upload is a valid form of service under the GST Act, it does not
ensure that the taxpayer is actually aware of the notice.
o Officers
must apply their mind and use other service modes under Section
169(1) (such as RPAD or email) if there is no response.
2. Natural
Justice is Not a Ritual
o Mere
technical compliance, like uploading notices online without ensuring delivery, defeats
the purpose of fair hearing.
o The
Court emphasized:
"Merely passing an
ex parte order by fulfilling the empty formalities will not serve any useful
purpose and will only lead to multiplicity of litigations."
3. GST
Officers Must Use Discretion
o When
the taxpayer doesn’t respond to digital notices, officers should explore
alternate delivery modes.
o Such
action aligns with the objective of the GST Act and prevents unnecessary
litigation.
Final
Judgment
The High Court issued the
following directions:
1. Impugned
order dated 20.11.2024 is set aside.
2. The
matter is remanded to the respondent, conditional upon the petitioner:
o Paying
25% of the disputed tax amount within 4 weeks of receipt of the
order.
3. Once
payment is made:
o The
petitioner shall file a reply/objection with documents within 3 weeks.
o The
respondent shall issue a 14-day clear notice for personal hearing and
pass a speaking order on merits thereafter.
4. No
costs were awarded. Connected miscellaneous petitions were
also disposed of.
Conclusion
This judgment reiterates
that fair procedure and real communication are essential in GST
adjudication. Merely uploading a notice does not discharge the duty of
effective service if it goes unnoticed. The Court’s insistence on a balanced
remand approach (with 25% pre-deposit) reflects its commitment to both
revenue interest and taxpayer rights. This is a critical precedent for all GST
officers and taxpayers alike.
Disclaimer: All the Information is based on the notification, circular advisory and order issued by the Govt. authority and judgement delivered by the court or the authority information is strictly for educational purposes and on the basis of our best understanding of laws & not binding on anyone.
Find the Attachment (Press on Click Here )
Click here
