Availability of GST order on common Portal does Not explicitly Imply Order Service

Baghel Trading Co Vs State Of U.P.  (Allahabad High Court)

In the realm of Goods and Services Tax (GST) disputes, one case has captured attention for its intricate examination of GST order communication and service. The case, Baghel Trading Co. vs. State of U.P., is currently under review by the Allahabad High Court. At the core of this case lies a crucial debate surrounding the interpretation of the words “communicated” and “served” in the context of the GST Act.

The Impugned Order: The petitioner, Baghel Trading Co., has challenged an order dated 23.10.2021, contending that it was neither communicated nor served to them. The petitioner’s argument hinges on the distinction between the words “communicated” and “served” as used in different sections of the GST Act.

Section 107 vs. Section 169: The petitioner asserts that while the order may have been made available on the GSTN Portal (Goods and Services Tax Network Portal), as allowed under Section 169 of the GST Act, this alone does not constitute communication of the order. According to the petitioner, an order can only be considered communicated when the relevant party becomes aware of it.

Modes of Service: To understand the dispute fully, it’s crucial to explore the GST Act’s modes of service. Section 169(1) outlines these modes, which include registered post, email, making available on the common portal, publication in newspapers, and affixation.

Deeming Provision: Importantly, Section 169(2) of the GST Act is under scrutiny. This section states that an order is deemed to be served only when it is delivered by hand or published, or a copy is affixed as provided in subsection (1). However, the law doesn’t explicitly state that an order made available on the common portal is deemed to be served.

Arbitrary Dismissal: The petitioner contends that their appeal was well within the statutory time limit, but the respondent authority arbitrarily dismissed it as time-barred.

Parallel Case: It’s noteworthy that another case, Writ Tax No. 948 of 2023, addresses a similar issue, and the two cases may be considered together.

Conclusion: The Baghel Trading Co. vs. State of U.P. case serves as a significant legal milestone in the context of GST disputes. The fundamental questions of order communication and service have profound implications for how the GST Act is interpreted and applied. As the Allahabad High Court examines this matter, it raises broader concerns about the intricacies of the law, the use of the GSTN Portal, and the practical implications for taxpayers. The outcome of this case will undoubtedly have far-reaching effects on how GST-related orders are communicated and served in the future.

FULL TEXT OF THE JUDGMENT/ORDER OF ALLAHABAD HIGH COURT

Heard Ms. Vedika Nath, learned counsel for the petitioner and learned ACSC for State – respondents.

The instant Writ Tax is being entertained by this Court in view of the fact that G.S.T. Tribunal is not functional in the State of Uttar Pradesh pursuant to the Gazette notification of the Central Government bearing number CG-DL-E-14092023-248743 dated 14.09.2023.

The instant writ petition has been filed challenging the orders dated 19.8.2023 and 23.10.2021.

Learned counsel for the petitioner submits that the impugned order was neither communicated, nor served upon the petitioner. She further submits that the respondent no. 2 has failed to appreciate the word “communicated” used in section 107 of the GST Act in contrast to the word “served” used in section 169 of the GST Act. Therefore, the order dated 23. 10.2021 may have been served by making it available on the portal as provided under section 169 of the GST Act, but the same will not amount to communication of the order as the order can be said to be communicated only when the person concerned comes to know about the same. He further submits that sub-section (1) of section 169 of the GST Act provides the mode of services, i.e., by registered post or speed post, communication on e-mail, making available on the common portal, by publication in newspaper or by affixation. However, as per sub-section (2) of section 169 of the GST Act, the order is deemed to be served only in case the service is effected by tendering or published or a copy thereof is affixed in the manner as provided in sub-section (1). She further submits that the Statute nowhere provides that the order made available on the common portal is deemed to be served and clauses (c) & (d) of sub-section (1) of section 169 of the GST Act are not covered by sub-section (2) of section 169 of the GST Act. Therefore, the appeal preferred by the petitioner was within limitation but the respondent authority has arbitrarily dismissed the appeal as time barred.

She further submits that identical issue is engaging the attention of this Court in Writ Tax No. 948 of 2023 and the present writ petition may be taken up along with the same.

Matter requires consideration.

Learned counsel for the respondents may file counter affidavit within a period of four weeks from today.

In the counter affidavit, the State shall specifically averred as to how and under what manner, the deeming service as per clauses (c) & (d) of sub-section (1) of section 169 can be said to be deemed service as per sub-section (2) of section 169 of the GST Act.

List thereafter along with Writ Tax No. 948/2023.

In the meantime, no coercive action shall be taken against the petitioner pursuant to the impugned order, provided the petitioner deposits 50% of the disputed tax amount in accordance with law within a period of two weeks from today.

Any amount already deposited by the petitioner shall be adjusted against the deposit to be made under this order.

Order Date :- 3.10.2023