Case Title: Tvl. Amman Steel v. Commissioner of Commercial Taxes & Anr
Court: Madurai Bench of Madras High Court
Petition No.: W.P.(MD) No. 22017 of 2025
Date of Judgment: 12.08.2025
Category: Input Tax Credit / Assessment Order
Relevant Sections: Sections 73, 74, and 75 of the CGST Act, 2017; Rule 142 of the CGST Rules, 2017
Facts (Para 2–5):
The petitioner, Tvl. Amman Steel, challenged the assessment order dated 24.01.2024 for FY 2018–19, wherein the department alleged wrong ITC claim and issued a tax demand of ₹29,195/- each under CGST and SGST, with equal interest and ₹10,000 penalty per head. The petitioner contended that its business was closed and registration cancelled on 30.09.2019, after which a DRC-01A notice was uploaded only on 21.10.2023, nearly four years later. Since the petitioner no longer accessed the GST portal, the notice went unnoticed. Moreover, it was argued that excess ITC of ₹52,390 had lapsed as per GSTR-9, demonstrating no intent to evade tax.
Questions for Determination:
Whether an assessment order passed without proper service of notice through the web portal—long after business closure—can be sustained under the CGST Act?
Court’s Observations (Para 5–8):
The Court observed that since the petitioner’s business had ceased and registration stood cancelled years before the notice was uploaded, non-access of the GST portal was a reasonable explanation. It noted a consistent judicial approach to such cases, emphasizing that principles of natural justice require actual communication of the notice. The Court relied on earlier similar rulings and found that a mere portal upload cannot constitute due service when the taxpayer is inactive on the system. The Court thus deemed it appropriate to quash the order and remand the matter for fresh consideration.
Judgment (Para 6–10):
The impugned assessment order was set aside. The matter was remitted to the Assessing Officer, subject to the petitioner depositing 25% of the disputed tax in cash within 30 days. The petitioner was permitted to file a reply treating the impugned order as an addendum to the earlier DRC-01 notice. Upon compliance, the officer was directed to pass a fresh order within three months, and the bank attachment was ordered to be released. If the petitioner failed to comply, the department could proceed as if the petition was dismissed.
Summary of Referred Cases and Verdicts:
| Case Name | Court | Principle / Verdict |
|---|---|---|
| Similar Madras HC rulings (unnamed in order) | Madras High Court | Upload of notice alone is not sufficient; actual communication is essential for compliance with natural justice. |
| Other consistent decisions cited implicitly | Madras High Court | Orders passed without effective notice are liable to be quashed and remanded with conditional deposit. |
Between Fine Lines:
This judgment reinforces that GST authorities must ensure effective service of notices, especially when a business has ceased operations. Portal uploads do not substitute actual communication. Taxpayers, however, must maintain vigilance or ensure closure procedures are complete to avoid such disputes.
Disclaimer – “The above summary is for academic purpose only; not formal legal opinion. Seek professional opinion before application. Author or publisher or website shall not be responsible for any usage in any form.”