M/S Macsun Healthcare vs. Union Of INDIA And Others

Facts

The petitioner, M/s Macsun Healthcare, filed a writ petition challenging the service of an order-in-original by uploading it on the common portal (www.gst.gov.in). The petitioner claimed to be illiterate and unaware of the uploaded order. The revenue contended that Section 169 of the Central Goods and Services Tax Act, 2017, read with relevant rules, permits service via the common portal. The case hinges on whether such uploading constitutes proper service, especially when the assessee claims no knowledge. The High Court had previously dealt with similar issues in "Luxmi Traders v. Union Territory of Chandigarh" and "The Amar Cooperative LC Society Ltd. v. State of Haryana and Others."

Held

The Court held that service of a Show Cause Notice (SCN) or an order-in-original upon an assessee cannot be deemed sufficient merely by uploading it on the Common Portal, unless its receipt is acknowledged or a reply is filed. The Court reiterated its findings from "Luxmi Traders v. Union Territory of Chandigarh" and "The Amar Cooperative LC Society Ltd. v. State of Haryana and Others." The Court found substance in the petitioner's submission that the Rules of 2017 do not explicitly refer to the Common Portal for the purpose of service of SCNs/orders, confining its utility to specific functions like registration, filing of returns, and payment of tax. The Court was not persuaded to take a different view based on the reference to Section 115 of the Act of 2022, as the complex process of service via uploading, especially when leading to serious civil consequences for the assessee and when the assessee claims illiteracy and lack of knowledge, cannot receive the approval of law. The writ petition was disposed of in terms of the "Luxmi Traders" judgment. If the petitioner had deposited 10% of the statutory pre-deposit, their appeal would be heard on merits. Any recovery would abide by the final adjudication, and any bank account attachment would be revoked.

Key Issues

1. Whether uploading of a notice and order-in-original on the common portal, www.gst.gov.in, amounts to proper service under Section 169 of the Central Goods and Services Tax Act, 2017, read with the relevant rules? Petitioner's arguments: The petitioner argued that the Rules of 2017 do not permit the uploading of Show Cause Notices (SCNs) or orders on the common portal for service. Rule 142 of the Rules of 2017 is the only provision for electronic communication, and it was argued that this Court, in "Luxmi Traders," had noted that emails do not contain the SCN/order itself. The petitioner further contended that the "Common Portal" is used for specific functions like registration, returns, and payment, not for formal service of SCNs/orders, and that the amendment by the Finance Act, 2022, introducing Section 115, does not legitimize service via uploading if the portal is not expressly notified for such purpose. The petitioner also asserted that being illiterate, they had no knowledge of the uploaded order. Revenue's arguments: The revenue contended that uploading on the common portal constitutes proper service, especially if the assessee has knowledge and contests proceedings. They relied on the amendment introduced by the Finance Act, 2022, which introduced Section 115, retrospectively amending a notification to include "all functions provided under the Central Goods and Services Tax Rules, 2017" to be performed on the common portal. The revenue argued that this amendment validates the use of the common portal for all functions, including service of SCNs and orders.