Assessment Order Set Aside Due to Improper Service of Notice

Case Title: Pradeepa Enterprises vs. Deputy State Tax Officer-1
Court: High Court of Judicature at Madras
Petition Number: W.P.No.32923 of 2024
Category of Dispute: Violation of Principles of Natural Justice
Date of Judgement: 13.11.2024
Relevant Sections: Article 226 of the Constitution of India, Section 75(4), 169(d) of CGST Act, 2017
Subject: Procedural lapse in service of GST assessment order and show cause notice

Facts of the Case [Para 2–3]

• Petitioner, Pradeepa Enterprises, engaged in civil works for the Greater Chennai Corporation and is a registered dealer under the GST regime.

• For FY 2020–21, discrepancies were found between GSTR-3B vs. Form 26AS and GSTR-9/9C.

• Department issued ASMT-10 on 04.07.2023, followed by a notice on 14.08.2023 and personal hearing on 30.08.2023.

• The petitioner neither replied nor attended the hearing, and the final order dated 05.07.2024 was uploaded only on the GST portal without physical service, which the petitioner claimed they could not access.

Question(s) in Consideration [Para 3–4]

• Whether the assessment order dated 05.07.2024 is sustainable when the petitioner contends non-receipt of show cause notice and denial of hearing due to exclusive service through the GST portal.

Observations of the Court [Para 3–6]

• The Court noted that principles of natural justice were violated as notices and orders were not served by physical means or registered post.

• The court relied on the precedent in Sree Manoj International v. Deputy State Tax Officer (W.P.No.10977 of 2024), where a similar matter was remanded after 10% of disputed tax was deposited.

• The Respondent did not raise serious objection to granting one final opportunity to the petitioner.

Judgement of the Court [Para 6–7]

• The impugned order dated 05.07.2024 was set aside.

• Petitioner directed to pay 10% of the disputed tax within four weeks.

• Upon such payment, the order shall be treated as a show cause notice, and petitioner shall file objections with documents in four weeks.

• If either of the above conditions is not met, the original order stands revived.

• Writ Petition was accordingly disposed of with no cost order.

Between Fine Lines

• Mere uploading of GST orders on the portal is not sufficient service if access is denied.

• The court reaffirms that physical service or registered post must be ensured under natural justice.

• One more opportunity was granted to the taxpayer on conditional pre-deposit.

• Assessment order was deemed show cause notice to allow defence submission.

• Remedial compliance within timelines is essential to avoid revival of order.

Summary of Referred Cases

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