Shivalik Medical Center Private Limited vs. State Of U.P. And Another

Facts

The petitioner, Shivalik Medical Center Private Limited, filed a writ petition challenging an order dated August 31, 2024, passed by the Assistant Commissioner, State Tax, NOIDA, under Section 73 of the Uttar Pradesh Goods and Services Tax Act, 2017. The petitioner's GST registration was cancelled on January 19, 2018, effective from July 1, 2017, and no business was conducted thereafter. A show cause notice was uploaded on the GST portal, leading to the impugned order. The petitioner contended that once registration is cancelled, they are not obligated to check the GST portal, and service of any notice must be through alternative means.

Held

The Court held that there was a violation of the principle of natural justice. The Court agreed with the principle enunciated by a coordinate Bench in M/s Katyal Industries v. State of U.P. and others. The reasoning was that once a taxpayer's registration is cancelled, they are not obligated to continuously check the GST portal for notices. The proper mode of service for any show cause notice must be through alternative means to ensure it reaches the petitioner. Consequently, the impugned order dated August 31, 2024, passed by the Assistant Commissioner, State Tax, was quashed and set aside. The department was granted liberty to issue a proper notice to the petitioner and proceed in accordance with the law. The ratio decidendi is that a cancelled registration absolves the taxpayer of the obligation to monitor the GST portal, and notices must be served through effective alternative channels to uphold natural justice.

Key Issues

1. Whether the service of a show cause notice uploaded on the GST portal is valid when the petitioner's GST registration has been cancelled and no business is being conducted, thereby violating the principle of natural justice? (Question of law) Petitioner's Arguments: The petitioner argued that after the cancellation of their GST registration, they were not obligated to monitor the GST portal. They contended that the mode of service for any show cause notice must be through alternative means to ensure proper communication. The petitioner relied on the decision of a coordinate Bench in M/s Katyal Industries v. State of U.P. and others, Neutral Citation No.2024:AHC:23697-DB, asserting agreement with the principle laid down therein. Revenue's Arguments: The judgment does not record any specific arguments made by the revenue or state.