GST Payer Not Required to Monitor Portal After Registration Cancellation: Allahabad HC

Micasa Vs Union of India and 3 others (Allahabad High Court)

Allahabad High Court has ruled that a Goods and Services Tax (GST) payer is not obligated to continuously monitor the GST portal for notices pertaining to the 2018-19 financial year, especially after their registration was cancelled on March 31, 2019. The judgment came in the case of Micasa Vs Union of India and 3 others, where the petitioner challenged an adjudication order dated April 24, 2024.

The court noted the undisputed fact that the petitioner’s GST registration was cancelled effective March 31, 2019, and had neither been revived nor was revival sought by the petitioner. Given this circumstance, the High Court accepted the argument that the petitioner could not be expected to access the GST portal for e-notices issued for the period prior to the cancellation.

Crucially, the revenue authorities also failed to demonstrate that any physical or offline notice was served upon the petitioner before the impugned order was passed. The High Court emphasized that the “essential requirement of rules of natural justice” had not been fulfilled due to the lack of proper notice.

Consequently, the court set aside the adjudication order dated April 24, 2024. The petitioner has been granted a period of four weeks to submit a reply to the show cause notice. Following this submission, the authorities are directed to pass a fresh order, affording the petitioner an opportunity for a personal hearing, as expeditiously as possible, ideally within three months. The writ petition was disposed of accordingly, highlighting the importance of proper communication and adherence to natural justice principles, particularly when a taxpayer’s registration status changes. No specific judicial precedents were explicitly referenced in the provided text of this judgment.

FULL TEXT OF THE JUDGMENT/ORDER OF ALLAHABAD HIGH COURT

1. Having heard Sri Mohit Behari Mathur, learned counsel for the petitioner and Sri Nimai Dass, learned Additional Chief Standing Counsel for the respondents, it remains undisputed that the petitioner’s registration under the UPGST Act, 2017 was cancelled w.e.f. 31.03.2019. It is not the case of the revenue that the said registration has ever been revived or that the petitioner ever sought revival of that registration.

2. In view of the above, it does merit acceptance that the petitioner was not obligated to visit the GST portal to receive the show cause notices that may have been issued to the petitioner for 2018-19 through e-mode, preceding the adjudication order dated 24.04.2024 passed in pursuance thereto.

3. It is also not the case of the revenue that any physical/offline notice was issued to or served on the petitioner before the impugned order came to be passed.

4. In view of peculiar facts noted above, no useful purpose may be served in keeping the petition pending or calling counter affidavit at this stage or to relegate the present petitioner to the forum of alternative remedy.

5. Since essential requirement of rules of natural justice has remained to be fulfilled, we set aside the order dated 24.04.2024. The petitioner may submit its reply to the show cause notice within a period of four weeks from today. Subject to such compliance by the petitioner, fresh order may be passed after affording opportunity of personal hearing, as expeditiously as possible, preferably within a period of three months therefrom.

6. Writ petition is accordingly disposed of.