A.S. Traders Vs State of Uttarakhand and Others (Uttarakhand High Court)
The writ petition was filed challenging an ex-parte assessment order dated 03.02.2024 passed under section 74(9) of the UKGST Act, along with the show cause notice, and consequential recovery proceedings initiated for Assessment Year 2020–21. The petitioner also sought remand of the matter for fresh adjudication after providing proper opportunity of hearing.
The petitioner, a sole proprietorship engaged in the business of iron scrap, submitted that due to the Covid-19 pandemic, the business was adversely affected, leading to closure of operations and application for surrender of GST registration on 14.08.2020. Subsequently, after a field survey, the registration was cancelled with effect from 31.03.2023.
It was stated that a show cause notice dated 14.12.2022 alleging non-payment of tax for the financial year 2020–21 was issued by uploading it on the GST portal. The petitioner contended that after closure of business and application for cancellation of registration, he did not monitor the GST portal and therefore remained unaware of the proceedings. As a result, the assessment was conducted ex-parte, leading to demand and recovery action.
The petitioner relied on judicial precedents, particularly decisions of the Allahabad High Court, which addressed the validity of service of notices solely through the GST portal and the requirement of granting an opportunity of hearing. The cited decisions held that service through the portal is only one of the permissible modes under section 169 of the CGST Act and cannot be treated as the exclusive mode, especially where the registration has been cancelled. It was further held that the department must ensure effective communication of notices to the assessee.
