Binod Traders Vs Union of India (Patna High Court)
The Patna High Court recently set aside an ex parte assessment order and a subsequent appellate order against Binod Traders, ruling that merely uploading a summary show-cause notice (SCN) on the GST portal does not constitute valid service under Section 169 of the Bihar Goods and Service Tax (BGST) Act, 2017. The court emphasized the necessity of adhering to prescribed modes of communication, including registered post, to ensure due process and opportunity for a taxpayer to respond.
Binod Traders had challenged an appellate order dated May 8, 2024, which dismissed their appeal due to delay. This appeal was filed against an ex parte assessment order dated September 20, 2023, passed under Section 73(5) of the BGST Act, and a subsequent demand in Form DRC-07 for the Financial Year 2017-18. The core of Binod Traders’ petition was that the assessment order was passed without granting any opportunity of hearing, as mandated by Section 75(4) of the BGST Act, and critically, without proper service of the show-cause notice itself.
The petitioner contended that the purported show-cause notice, dated August 11, 2023, was merely uploaded to the GST portal under the heading “Additional Notices and Orders.” They argued that this method did not constitute a valid mode of service as stipulated by Section 169 of the BGST Act, and consequently, they were unable to file a reply. This lack of proper service, according to the petitioner, amounted to a violation of the principles of natural justice, rendering both the ex parte assessment and the delayed appeal rejection invalid.
