Case Law Details
360 Realtors Llp Vs Department of Revenue And 2 Others (Allahabad High Court)
The petitioner challenged the order dated 23 July 2024 passed by the respondent authority under Section 73 of the Uttar Pradesh Goods and Services Tax Act, 2017, for the financial year 2019–2020, which created a tax demand of ₹1,14,34,191. The petitioner, a regular taxpayer operating through the GST portal, contended that he was never served with the show cause notice dated 22 May 2024 and, therefore, had no knowledge of the proceedings. It was argued that neither the notice nor the final order was communicated through any physical mode. Instead, both were uploaded only on the common portal under the tab titled “Additional Notices and Orders,” which was not visible directly from the home page or dashboard. Due to this, the petitioner was unable to access or respond to the notice and remained unaware of the adjudication order until recovery proceedings were initiated, resulting in the attachment of his bank account. Only then did he become aware of the order through the bank authorities.
Upon discovering the order, the petitioner promptly filed an appeal; however, since both the prescribed limitation period and the permissible period for condonation of delay had expired, the appeal was dismissed as time-barred. Consequently, the petitioner approached the High Court seeking relief against the impugned adjudication order.
The Revenue, through its counsel, opposed the petition by asserting that under Section 169(1)(d) of the UPGST Act, 2017, the adjudicating authority is duly empowered to serve notices and orders via the common GST portal. It was further contended that since the petitioner admitted to being an active user of the GST portal, he was presumed to have knowledge of the notice and order uploaded there. The Revenue argued that the petitioner’s failure to click on or check the “Additional Notices and Orders” tab could not serve as a legitimate ground for claiming lack of knowledge or denial of natural justice. Additionally, the Revenue submitted that since the petitioner’s appeal had already been dismissed as time-barred, the writ petition was not maintainable in the absence of any challenge to the order of the appellate authority.
Counsel for the GSTN submitted that the GST portal was functioning properly and no relief was sought against it, hence no contention was raised from their side.
After hearing all parties, the High Court observed that a significant number of similar cases are being filed daily by assessees across the State, raising identical grievances regarding the manner in which show cause notices and adjudication orders are communicated through the GST portal. The Court acknowledged that assessees face recurring difficulties in accessing such communications promptly. The system of placing important notices and orders under specific tabs like “Additional Notices and Orders,” instead of displaying them prominently on the taxpayer’s dashboard, often leads to unawareness and non-compliance, resulting in avoidable litigation.
The Court also took note of the strict limitation provisions governing appeals under the GST law. It observed that, as per the settled legal position, even the appellate authorities and courts are not empowered to condone delay beyond the statutorily prescribed period. Furthermore, even when appeals are filed within time, the appellate authorities under the GST regime do not possess the power to remand or remit matters back to the adjudicating authority. Their jurisdiction is confined to deciding appeals on merits.
The Court emphasized that the success of any tax system depends substantially on the trust and confidence of the taxpayers. To the extent that the difficulties cited by the petitioner and other similarly placed assessees appear genuine, the writ court must intervene to ensure that justice is served and that procedural deficiencies do not deprive taxpayers of a fair opportunity to present their case.
The Court clarified that the dismissal of the appeal on grounds of limitation cannot be treated as a decision on the merits of the case. An order rejecting a delay condonation application is distinct from a decision in an appeal; only if the delay had been condoned would a regular appeal have arisen and been adjudicated on merits.
In light of these findings, the Court set aside the impugned adjudication order dated 23 July 2024, subject to certain conditions. The petitioner was directed to deposit ₹1,00,000 within one month. Upon such deposit, the impugned order would stand set aside. The petitioner was permitted to file a reply to the show cause notice within two weeks thereafter. The adjudicating authority was directed to fix a suitable date for a personal hearing and pass a speaking and reasoned order addressing all objections raised by the petitioner, on or before 31 March 2026. The Court also ordered that any amount deposited under this direction would be subject to the final outcome of the adjudicating authority’s order.
Accordingly, the writ petition was disposed of with these directions.
FULL TEXT OF THE JUDGMENT/ORDER OF ALLAHABAD HIGH COURT
1. Heard Sri Vishwaraj Raj Singh along with Sri Manish Tiwari and Varunendra Kishore Dwivedi, learned counsel for the petitioner, Sri Ankur Agarwal, learned counsel for the Revenue and Sri Gopal Verma, learned counsel for the UPGSTIN
2. Challenge has been raised to the order dated 23.07.2024 passed by respondent no. 2 under Section 73 of the UPGST Act, 2017 for the financial year 2019-2020 creating a demand of tax Rs.1,14,34,191/-.
3. Submission is, though the petitioner is a regular tax payer and was working on the GST Portal. At the same time, he was not served with the show cause notice dated 22.05.2024. Thus, he was not aware of the date of filing of reply and date of personal hearing if any, at the relevant time. Similarly, the petitioner was not aware of the impugned order being passed against him on 23.07.2024 as that order was not served upon him through physical mode. Both, the show cause notice and the impugned order were put up on the common portal under the Tab meant for ‘Additional Notices and Orders’. The notice and order was not directly visible on the home page/ dash board. Hence, the assessee was not facilitated with an option to easily view that notice and order and to respond to the same within reasonable time.
4. Only after the recovery proceedings were initiated and the bank account of the petitioner came to be attached, the petitioner learnt of the proceedings and the impugned order through the bank authorities. He immediately filed appeal against the impugned order dated 23.07.2024. However, since the period of limitation and also since the period for condonation of delay expired, the appeal itself came to be dismissed as time barred. Hence this petition.
5. Learned counsel for the Revenue would contend, Section 169 (1) (d) permits the adjudicating authority to serve notices and orders on the assessee through the common portal. To the extent the assessee admits that he was working on the common portal, it may be presumed that he had due knowledge of the notice and the order. Merely because the petitioner may not have chosen to press/select the Tab for additional notices it may not be excuse to set up a fallacious plea that the petitioner has no knowledge of such proceedings or orders passed therein.
6. Second it has been submitted once the appeal filed by the petitioner has been dismissed, the present petition may not be maintained as no challenge has been laid to that order passed by the appeal authority.
7. Gopal Verma, learned counsel appearing for the GST would submit that the GSTIN is working well. No relief has been sought against GSTIN.
8. Having heard learned counsel for the parties and perused the record, in the first place it has been recognized that a considerable influx of litigation of similar nature is arising every day. Clearly, the assessees are facing difficulties in working on the GST Portal especially with respect to communication of Show Cause Notices and Adjudication Orders. Every day a large number of similar writ petitions are arising wherein numerous assessees are raising the common complaint that such notice and orders were not in their knowledge as they were not displayed promptly on the dash board upon such notices being issued or orders being passed.
9. We are mindful of the rigid period of limitation to file appeals under the GST regime. Under the law as declared by the Supreme Court condonation of delay cannot be granted beyond the fixed time period provided by the statute. Third, even their appeals are filed within time, the appeal authorities do not have the power to remand or remit the matter to the Adjudicating Authority. They may only pass an order on merits.
10. Any tax regime may work most efficiently only where the trust of the tax payers, exists. To the extent, the difficulties being faced by the assesssees in general and as cited by the petitioner appear to be genuine and not false or a pretense, the writ court may not fail in its duties to ensure that the cause of justice is served well.
11. The fact that the appeal authority may have rejected the appeal as time barred may not amount to an order passed in the appeal. It may only remain order passed on the application seeking condonation of delay. Only if the delay had been condoned, a regular appeal may have arisen.
12. Accordingly, the impugned order is set aside subject to the petitioner depositing Rs. 1,00,000/- lacs within a period of one month from today. Subject to such deposit being made, the impugned order shall stand set aside. The petitioner shall file his reply within two weeks. Thereafter the adjudicating authority may fix appropriate date for hearing and pass speaking and reasoned order dealing with the objections that may be raised by the petitioner on or before 31st March, 2026. Any amount deposited under this order shall remain subject to the final order to be passed by the adjudicating authority.
13. The writ petition is disposed of.
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