Dismissal of Appeal Set Aside and Remanded for Hearing

Dismissal of Appeal Set Aside and Remanded for Hearing on Merits As Uploading Show Cause Notice Only Under Portal Tab Violated Natural Justice

Issue

Whether an appellate order dismissing a GST appeal on limitation grounds is sustainable when the Show Cause Notice (SCN) was uploaded solely under the “Additional Notices and Orders” portal tab without proper service, violating principles of natural justice.

Facts

Periods Involved: The dispute relates to FY 2020-21 (appellate order), March 2021 to April 2022 (SCN), and FYs 2023-24 to 2025-26 (recovery proceedings).
Improper Service of SCN: The Show Cause Notice in Form GST DRC-01 was uploaded exclusively under the “Additional Notices and Orders” tab on the GST portal.
Lack of Awareness: The petitioner remained unaware of the ongoing adjudication proceedings and only learned about the adverse adjudication upon receiving a recovery email.
Recovery Actions: Revenue initiated recovery actions by debiting the Electronic Credit Ledger and issuing garnishee orders targeting FYs 2023-24 to 2025-26.
Dismissal on Limitation: The statutory appeal filed for FY 2020-21 was rejected by the Appellate Authority solely on limitation grounds without entering into the merits.
Writ Petition: The petitioner challenged the appellate order via a writ petition, citing lack of proper service under Section 169 and a breach of natural justice.

Decision

Violation of Natural Justice: The High Court held that uploading an SCN exclusively under the “Additional Notices and Orders” portal tab failed to constitute effective service, thereby violating principles of natural justice.
Procedural Discrepancies Noted: The Court highlighted discrepancies where the appellate order concerned FY 2020-21, whereas recovery actions targeted FYs 2023-24 to 2025-26.
Sufficient Cause Established: The petitioner established a prima facie case, and the delay in filing the appeal was found to be sufficiently explained due to improper service.
Appellate Order Quashed: The impugned appellate order was set aside, and the Appellate Authority was directed to entertain the appeal and adjudicate it on merits in accordance with the law [Para 9].
Outcome: Decided in favor of the assessee; matter remanded.

Key Takeaways

Tab-Specific Uploading Is Not Proper Service: Uploading SCNs or adjudication orders solely under obscure tabs like “Additional Notices and Orders” without due notification deprives taxpayers of effective notice and violates Section 169 read with natural justice.
Writ Remedy Against Limitation Dismissals: High Courts will intervene under Article 226 to condone appellate delays if the underlying cause was procedural non-service or defective electronic service by the department.
Adjudication on Merits Restored: Rejection of an appeal on technical time-bar grounds cannot stand when the taxpayer was kept in the dark due to defective departmental service procedures.

HIGH COURT OF CALCUTTA

Raju Ghosh

State of WB

Smita Das De, J.

WPA No. 6129 of 2026

JULY 16, 2026

Himangshu Kumar Ray and Ms. Shiwani Shaw for the Petitioner. Ms. Manasi Mukherjee and Bijitesh Mukherjee for the Respondent.

ORDER

1. Affidavit of service filed in Court today be kept with the record.

2. The present writ petition has been filed challenging inter alia, the legality and validity of the appellate order 28^th January, 2026 passed by the respondent no.3 under Section 107 of the West Bengal Goods and Services Tax Act (hereinafter referred to as the said “WBGST Act) and the Central Goods and Services Tax Act, 2017 (hereinafter referred to as the said ‘CGST Act) whereby the appeal of the petitioner has been dismissed on the ground of limitation.

3. Learned counsel appearing for the petitioner submits as follows:

That a notice in Form GST DRC-01 bearing reference No.ZD90924039975M dated 26.09.2024 has been issued to the petitioner for the period March 21 to April 22 demanding tax interest penalty.

ii.

That the said notice has been uploaded on the GST portal under the “tab Additional notice and orders.” As a result of which the petitioner could not respond to the show cause notice.

iii.

That the petitioner came to know the order of adjudication dated 3.7.25 only upon receiving a recovery e-mail dated 19.11.2025.

iv.

That prior to the issuance of the adjudication order an amount of Rs. 2,33,254/- has been recovered from the electronic credit ledger on 12.3.25. A further amount of Rs. 3,75,830/-has also been recovered on 23.02.2026. In total, 46% of the disputed demand of Rs. 13,13,468/- has already been recovered.

That being aggrieved, the petitioner preferred an appeal on 18.12.25. However the same has been dismissed by the appellate order on 28.1.26 solely on the ground of limitation, without going into merit of the case.

vi.

That from Annexure P13 at page 114, it appears that garnishee proceedings have been initiated for the periods 2023-24 to 2025-26 whereas the appellate order relates to Financial Year 2020-21. This shows non application of mind of the respondent authorities.

4. The petitioner places reliance upon Section 107 sub-section (7) of the said act, since it has been contemplated that in cases the appellant has paid the amount under sub-section (6) of section 107, the recovery proceedings shall be deemed to be stayed.

5. Learned counsel for the State respondent vehemently opposes the prayer of the petitioner and submits that:

Ample opportunities have been granted to the petitioner to substantiate their case before the appellate authority.

ii.

The petitioner has failed to make out a proper case and did not give any proper explanation for the delay in filing the appeal.

iii.

The appellate order does not suffer from any infirmity and is sustainable in the eye law.

6. Having heard the parties and upon perusing the records this court observes;

That the show cause notice has been only uploaded under the tab ‘Additional notice and orders’ therefore could not reply to the same, which constitutes a violation of principles of natural justice.

ii.

This court further notes a material discrepancies. The appellate order relates to Financial Year 2020-21 whereas recovery/garnishee proceedings have been initiated for Financial Year 2023-24 to 2025-26.

7. This court of the view that the petitioner is able to make out a prima facie case warranting an interference. In the interest of justice, the petitioner shall be given a further opportunity.

8. This court finds that the reasons for the delay in filing the appeal have been sufficiently explained by the petitioner in paragraph nos. 11 and 12 of the writ petition. Such reasons are of paramount importance and should be considered by the appellate authority while deciding the case on merits.

9. In view of the above, the appellate order is accordingly quashed and set aside with the following directions:

The appellate authority shall entertain the appeal and decide the same on merits in accordance with law.

ii.

The entire excise of adjudication shall be concluded on or before 30^th September, 2026. The petitioner shall cooperate and shall not seek any further adjournment.

10. Since the petitioner has already made the pre-deposit for preferring the appeal, no further deposit is required to be paid for expeditious hearing of the matter.

11. All points are left open for the appellate authority to decide on merits. The recovery proceedings shall be not be influenced by this order.

12. With the above observations and directions this writ petition stands disposed of.

13. Since no affidavit in opposition has been called for, the allegations contained in the writ petition are deemed to have been denied and not admitted.

14. Urgent Photostat certified copy of this order be supplied to the parties, if applied for, as early as possible.