Case Law Details
Tvl. Sri Samy Agencies Vs Commissioner of Commercial Taxes (Madras High Court)
The Madras High Court considered a writ petition challenging an assessment order dated 25.10.2024 passed by the second respondent. By consent of the parties, the matter was taken up for final disposal at the admission stage. The petitioner contended that all notices and communications were uploaded only on the GST common portal and that they were unaware of such notices. As a result, no reply was filed within the stipulated time, and the impugned order was passed without granting an opportunity of personal hearing. The petitioner further submitted that the original show cause notice was not furnished and expressed willingness to pay 25% of the disputed tax amount if an opportunity to present their case was granted.
The respondents submitted that notices were uploaded on the GST portal and the petitioner failed to respond. However, it was fairly admitted that no personal hearing was afforded prior to passing the impugned order. The respondents agreed that the matter could be remanded, subject to payment of 25% of the disputed tax amount.
Upon examining the record, the Court noted that while service of notice through the GST portal is a valid mode, the absence of any response from the taxpayer required the officer to explore other prescribed modes of service under Section 169(1) of the GST Act. The Court observed that merely uploading notices and passing ex parte orders without ensuring effective service amounted to empty formalities and would only lead to unnecessary litigation. The Court emphasized that officers should apply their mind and adopt alternative modes of service, preferably by registered post with acknowledgment due, to effectively achieve the object of the GST Act.
Finding that the assessment order was passed without affording an opportunity of personal hearing and that there was a lack of effective service of notices, the Court set aside the impugned order. The matter was remanded for fresh consideration, subject to the petitioner paying 25% of the disputed tax within four weeks. The petitioner was directed to file replies and documents within three weeks thereafter. The respondent was directed to issue a clear 14-day notice for personal hearing and pass fresh orders on merits in accordance with law. The writ petition was disposed of with no order as to costs.
FULL TEXT OF THE JUDGMENT/ORDER OF MADRAS HIGH COURT
This writ petition has been filed challenging the impugned order dated 25.10.2024 passed by the 2nd respondent.
2. Mr. R.Suresh Kumar, learned Additional Government Pleader, takes notice on behalf of the respondents.
3. By consent of the parties, the main writ petition is taken up for disposal at the admission stage itself.
4. The learned counsel for the petitioner would submit that in this case, all notices/communications were uploaded by the respondent in the GST common portal. Since the petitioner was not aware of the said notices, they failed to file their reply within the time. Under these circumstances, the impugned order came to be passed by the respondent without providing any opportunity of personal hearing to the petitioner. Therefore, this petition has been filed.
5. Further, he would submit that the petitioner is willing to pay 25% of the disputed tax amount, to the respondent. Hence, he requests this Court to grant an opportunity to the petitioner to present their case before the respondent by setting aside the impugned order.
6. On the other hand, the learned Additional Government Pleader appearing for the respondent would submit that the respondent had uploaded the notices in the GST Online Portal. But the petitioner failed to avail the said opportunity. Further, he has fairly admitted that no opportunity of personal hearing was provided to the petitioner prior to the passing of impugned order. Therefore, he requested this Court to remit the matter back to the respondent, subject to the payment of 25% of the disputed tax amount as agreed by the petitioner.
7. Heard the learned counsel for the petitioner and and the learned Additional Government Pleader for the respondent and also perused the materials available on record.
8. In the case on hand, it is evident that the show cause notice was uploaded on the GST Portal Tab. According to the petitioner, he was not aware of the issuance of the said show cause notice issued through the GST Portal and the original of the said show cause notice was not furnished to them. In such circumstances, this Court is of the view that the impugned assessment order came to be passed without affording any opportunity of personal hearing to the petitioner, confirming the proposals contained in the show cause notice.
9. No doubt, sending notice by uploading in portal is a sufficient service, but, the Officer who is sending the repeated reminders, inspite of the fact that no response from the petitioner to the show cause notices etc., the Officer should have applied his/her mind and explored the possibility of sending notices by way of other modes prescribed in/8 Section 169 of the GST Act, which are also the valid mode of service under the Act, otherwise it will not be an effective service, rather, it would only fulfilling the empty formalities. Merely passing an ex parte order by fulfilling the empty formalities will not serve any useful purpose and the same will only pave way for multiplicity of litigations, not only wasting the time of the Officer concerned, but also the precious time of the Appellate Authority/Tribunal and this Court as well.
10. Thus, when there is no response from the tax payer to the notice sent through a particular mode, the Officer who is issuing notices should strictly explore the possibilities of sending notices through some other mode as prescribed in Section 169(1) of the Act, preferably by way of RPAD, which would ultimately achieve the object of the GST Act. Therefore, this Court finds that there is a lack of opportunities being provided to serve the notices/orders etc., effectively to the petitioner.
11. Further, it was submitted by the learned counsel for the petitioner that the petitioner is willing to pay 25% of the disputed tax amount to the respondent. In such view of the matter, this Court is inclined to set aside the impugned order dated 25.10.2024 passed by the respondent. Accordingly, this Court passes the following order:-
(i) The impugned order dated 25.10.2024 is set aside and the matter is remanded to the 2nd respondent for fresh consideration on condition that the petitioner shall pay 25% of the disputed tax amount to the respondent within a period of four weeks from the date of receipt of a copy of this order. The setting aside of the impugned order will take effect from the date of payment of the said amount.
(ii) The petitioner shall file their reply/objection along with the required documents, if any, within a period of three weeks from the date of payment of amount as stated above.
(iii) On filing of such reply/objection by the petitioner, the respondent shall consider the same and issue a 14 days clear notice, by fixing the date of personal hearing, to the petitioner and thereafter, pass appropriate orders on merits and in accordance with law, after hearing the petitioner, as expeditiously as possible.
12. With the above directions, this writ petition is disposed of. No costs. Consequently, the connected miscellaneous petition is also closed.
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