GST Notice on portal insufficient without registered post or other communication modes.

GST SCN upload on portal is insufficient service; order set aside and remanded for fresh notice and speaking order.

Issue:

Whether merely uploading a summary show cause notice (SCN) on the GST portal constitutes sufficient service, or if other modes of communication (like registered post with acknowledgment) are also required, such that failure to adhere to Section 169 of the Central Goods and Services Tax Act, 2017 (CGST Act, 2017), would render the subsequent demand order invalid.

Facts:

• For the period 2017-18, a notice was issued to the assessee, and it was uploaded on the GST portal.
• Subsequently, a final order was passed by the Adjudicating Authority under Section 73 (tax not involving fraud).
• The assessee preferred a belated appeal, which was rejected (presumably on limitation grounds).
• The core issue in the present case was whether uploading a summary show cause notice on the portal would suffice as valid service.

Decision:

The court held in favor of the assessee. It relied on a decision by a Coordinate Bench of the High Court, which had previously ruled that uploading an SCN on the portal alone would not be sufficient, nor would it substitute registered post with acknowledgment and other modes of communication that are required to be adhered to. In light of these facts and circumstances, for non-compliance with Section 169 (which governs service of notice), the impugned orders were set aside, and the matter was remanded. The Adjudicating Authority was directed to issue a fresh summary show cause notice and pass a speaking order.

Key Takeaways:

• Section 169 (Service of Notice): This section specifies the various modes of service of notice, order, or any other communication under the GST Act. While electronic methods are included, courts often emphasize that physical modes (like registered post) are also crucial, especially if electronic methods fail to ensure actual knowledge.
• Sufficiency of Portal Upload: This judgment (and the Coordinate Bench’s decision it relies upon) takes a view that mere upload on the portal, without further steps (like intimation via email/SMS to the registered contact, or physical service when electronic service fails), may not be considered sufficient service, particularly if the assessee genuinely claims non-receipt or lack of knowledge.
• Importance of Actual Knowledge: The spirit of natural justice (audi alteram partem) requires that the assessee must have actual knowledge of the proceedings against them. If portal-based service is ineffective in conveying this knowledge, the fundamental right to be heard is violated.
• “Would not suffice nor would substitute registered post”: This strong phrasing indicates that the court views portal upload as an additional or supplementary mode, but not always a complete substitute for more traditional, verifiable methods, especially if those are mandated or the primary method fails.
• Consequence of Non-Compliance: Non-compliance with the proper service provisions of Section 169 leads to the invalidation of subsequent orders.
• Remand for Due Process: The setting aside of the impugned orders and remanding the matter ensures that the Adjudicating Authority follows the correct procedure for service of notice and passes a speaking (reasoned) order after providing a proper opportunity to the assessee. This restores due process.
• Favorable to Assessee: The assessee gets another chance to contest the demand on its merits, with proper notice and hearing.