Portal-Only Service Post-Cancellation Without Alternative Delivery Violates Natural Justice, Remanding Ex-Parte Assessment

By | November 3, 2026
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Portal-Only Service Post-Cancellation Without Alternative Delivery Violates Natural Justice, Remanding Ex-Parte Assessment
Issue Whether uploading a Show Cause Notice (SCN) solely on the GST portal post-cancellation of registration, without resorting to alternative service modes like email or physical post, combined with the non-grant of a personal hearing, violates natural justice and invalidates an ex-parte assessment order under Section 75 read with Section 169.
Facts
  • Assessee & Order Challenged: The assessee, a registered person whose GST registration was subsequently cancelled on its own application, challenged an ex-parte assessment order issued in Form GST DRC-07 for FY 2019-20.
  • Allegation in SCN: The Department issued an SCN alleging under-declaration of tax liability in Form GSTR-3B compared to portal records.
  • Mode of Service: The SCN was uploaded solely under a specific tab on the GST portal after the assessee’s registration had already been cancelled. No physical copy (such as via Registered Post with Acknowledgment Due – RPAD) or email communication was served.
  • Denial of Hearing: The Adjudicating Authority passed an ex-parte order confirming the SCN proposals without affording a mandatory personal hearing to the assessee.
  • Conditional Willingness: The assessee expressed willingness to deposit 20% of the disputed tax to secure a fair opportunity to contest the matter on merits.
Decision
  • Inadequacy of Portal-Only Service Post-Cancellation:
    • While uploading on the GST common portal is a recognized mode of service, once a registration stands cancelled, an absence of response warrants exploring alternative statutory modes of service under Section 169 (preferably RPAD or registered email).
  • Breach of Principles of Natural Justice:
    • The Department’s failure to ensure effective service, coupled with the denial of a mandatory personal hearing as required under Section 75, rendered the assessment legally unsustainable.
  • Setting Aside & Conditional Remand:
    • Subject to the assessee depositing 20% of the disputed tax amount, the impugned assessment order was quashed and set aside.
    • The matter was remanded to the Adjudicating Authority for fresh consideration after granting an effective personal hearing.
Key Takeaways
  • Duty to Explore Alternative Service Modes: When a taxpayer’s GST registration is cancelled, authorities cannot rely exclusively on portal uploads; they must utilize secondary statutory modes under Section 169 (such as registered post or email) to ensure valid service.
  • Mandatory Nature of Personal Hearing: Omission of a personal hearing under Section 75 invalidates ex-parte adjudication orders for breach of natural justice, especially when notice service itself is defective.
  • Conditional Relief on Remand: Courts may impose a pre-deposit condition (e.g., 20% of disputed tax) to balance Revenue interests while restoring procedural rights and remanding matters for fresh adjudication.
HIGH COURT OF MADRAS
Mayur Industries Traders
v.
Assistant Commissioner (ST)
Krishnan Ramasamy, J.
WP No. 38614 of 2026
WMP NO. 43319 OF 2026†
OCTOBER  7, 2026
K. Vasanthanayagan, Adv. for the Petitioner. R. Sethu Prabakaran, Govt. Adv. (Taxes) for the Respondent.
ORDER
1. The present Writ Petition has been filed challenging the assessment order in Form GST DRC-07 dated 19.08.2024.
2. The learned counsel for the petitioner submits that in respect of the financial year 2019-2020, the respondent initiated proceedings alleging that the petitioner had not declared the correct tax liability while filing its returns in Form GSTR-3B. Subsequently, the petitioner’s GST registration was cancelled upon the taxpayer’s application with effect from 30.06.2024. The petitioner was under the bona fide impression that all proceedings concerning the GST registration had come to an end and that there were no further proceedings requiring its immediate attention, particularly regarding online communications. Under such circumstances, the impugned order came to be passed. The petitioner was not afforded an effective opportunity to place its explanation and supporting documents before the respondent prior to the passing of the impugned order. The proceedings were concluded without properly considering the petitioner’s actual business transactions, books of account, tax invoices, returns, Input Tax Credit (ITC) particulars, and the reconciliation of the alleged differences. He further contends that the mandatory requirement of an effective personal hearing under Section 75(4) of the CGST Act has not been complied with, and that the order has been passed in gross violation of the principles of natural justice.
3. Further, the learned counsel for the petitioner submitted that the petitioner is willing to deposit 20% of the disputed tax amount with the respondent.
4. On the other hand, the learned Government Advocate appearing for the respondent submits that the respondent had uploaded the notices on the GST online portal, but the petitioner failed to avail of the said opportunity. However, he fairly admitted that no opportunity of a personal hearing was provided to the petitioner prior to the passing of the impugned order. Furthermore, since the notices were issued subsequent to the cancellation of the petitioner’s GST registration, he requested this Court to remit the matter back to the respondent for fresh consideration, subject to the condition that the petitioner deposits 20% of the disputed tax amount.
5. Heard the learned counsel for the petitioner and the learned Government Advocate (Taxes) for the respondent, and also perused the materials available on record.
6. In the case on hand, it is evident that the show-cause notice was uploaded only under the specific tab of the GST portal. According to the petitioner, they were not aware of the issuance of the said show-cause notice via the portal, as it was issued subsequent to the cancellation of their GST registration, and the physical copy of the said notice was never served upon them. In such circumstances, this Court is of the view that the impugned assessment order came to be passed without affording an opportunity of a personal hearing to the petitioner, thereby confirming the proposals contained in the show-cause notice.
7. No doubt, sending notice by uploading in portal is a sufficient service, but, the Officer who is sending the repeated reminders, despite the fact that there is no response from the petitioner to the show cause notices etc., the Officer should have applied his/her mind and explored the possibility of sending notices by way of other modes prescribed in Section 169 of the GST Act, which are also the valid mode of service under the Act, otherwise it will not be an effective service, rather, it would only amount to fulfilling the empty formalities. Merely passing an ex parte order by fulfilling the empty formalities will not serve any useful purpose and the same will only pave way for multiplicity of litigations, not only wasting the time of the Officer concerned, but also the precious time of the Appellate Authority/Tribunal and this Court as well.
8. Thus, when there is no response from the tax payer to the notice sent through a particular mode, the Officer who is issuing notices should strictly explore the possibilities of sending notices through some other mode as prescribed in Section 169(1) of the Act, preferably by way of RPAD, which would ultimately achieve the object of the GST Act. Therefore, this Court finds that there has been a lack of effort in applying the available opportunities to serve the notices/orders etc., effectively on the petitioner.
9. Further, it was submitted by the learned counsel for the petitioner that the petitioner has voluntarily cancelled their GST Registration. When such being the case, all the communications should have been sent to the e-mail id provided by the petitioner. However, the respondent had failed to do so. Under these circumstances, the impugned order came to be passed by the respondent without providing any opportunity of personal hearing, which is a clear violation of principles of natural justice.
10. That apart, now, the petitioner is willing to pay 20% of the disputed tax amount to the respondent. In such view of the matter, this Court is inclined to set aside the impugned order dated 19.08.2024 passed by the respondent. Accordingly, this Court passes the following order:-
(i) The impugned order dated 19.08.2024 is set aside and the matter is remanded to the respondent for fresh consideration on condition that the petitioner shall pay 20% of disputed tax amount to the respondent within a period of four weeks from the date of receipt of a copy of this order. The setting aside of the impugned order will take effect from the date of payment of the said amount.
(ii) The petitioner shall file their reply/objection along with the required documents, if any, within a period of three weeks from the date of payment of amount as stated above.
(iii) On filing of such reply/objection by the petitioner, the respondent shall consider the same and issue a 14 days clear notice, by fixing the date of personal hearing, to the petitioner and thereafter, pass appropriate orders on merits and in accordance with law, after hearing the petitioner, as expeditiously as possible.
11. With the above directions, this writ petition is disposed of. No costs. Consequently, WMP.No.43319/2026 is ordered.