A Prabhu vs. The State Tax Officer (Fac)

Facts

The petitioner, A Prabhu, filed a writ petition challenging an order dated 22.05.2025, passed by the State Tax Officer (FAC) under Section 73 of the TNGST Act, 2017, for the tax period 2021-22. The petitioner contended that the entire assessment proceedings, including the show cause notice and the final order, were only uploaded to the portal, which prevented them from effectively utilizing the opportunity to respond. The respondents argued that uploading the documents to the portal constitutes valid service as per the Act and rules, and therefore, the petitioner's failure to participate in the proceedings was without justification. The petitioner also sought the defreezing of their bank account.

Held

The Court held that while the respondents' contention regarding service by uploading to the portal has merit, it is also important to grant the petitioner one opportunity to present their case. Consequently, the Court decided to allow the writ petition on specific terms. The impugned order dated 22.05.2025 was set aside, and the matter was remanded back to the first respondent for fresh disposal. The petitioner was directed to deposit 25% of the disputed tax amount within four weeks. Upon such deposit, the petitioner would be permitted to appear before the first respondent, file a reply, submit supporting documents, and raise all factual and legal grounds. The first respondent was directed to pass fresh orders in accordance with the law. The Court also clarified that if the petitioner succeeds, the deposited amount would be adjusted against other liabilities. The freezing of the bank account was ordered to be raised as the impugned order was set aside. The issue of whether the uploading of documents to the portal alone constitutes sufficient service was not definitively decided, but the court exercised its discretion to grant a further opportunity.

Key Issues

1. Whether the uploading of the show cause notice and the order in the portal constitutes proper service of notice and opportunity to be heard under Section 73 of the TNGST Act, 2017, thereby vitiating the impugned order? Petitioner's contention: The petitioner argued that mere uploading of the show cause notice and the order in the portal did not provide a meaningful opportunity to participate in the assessment proceedings, leading to a procedural defect. Revenue's contention: The respondents contended that as per the TNGST Act and its rules, uploading of the show cause notice and the order in the portal amounts to valid service, and the petitioner failed to avail the opportunity provided.