M/S Pragati Traders vs. State Of Uttar Pradesh And Another

Facts

The petitioner, M/s Pragati Traders, had its GST registration under the UPGST Act, 2017 cancelled on August 17, 2021, effective from March 31, 2021. The revenue has not contended that this registration was ever revived or that the petitioner sought its revival. Consequently, the petitioner argues it was not obligated to check the GST portal for show cause notices issued for the period April 2018 to March 2019, which preceded an adjudication order dated April 22, 2024. The revenue has also not claimed that any physical or offline notice was served on the petitioner before the impugned order was passed. The court noted these peculiar facts, deeming it unnecessary to keep the petition pending or relegate the petitioner to an alternative remedy.

Held

The Court held that the petitioner was not obligated to visit the GST portal to receive show cause notices for the period April 2018 to March 2019, given that its GST registration was cancelled effective March 31, 2021, and had not been revived. The Court found that the essential requirement of the rules of natural justice had not been fulfilled, as no physical or offline notice was served on the petitioner prior to the impugned adjudication order dated April 22, 2024. The revenue did not dispute these facts. Consequently, the Court set aside the adjudication order dated April 22, 2024, and a prior order dated December 27, 2023. The petitioner was granted four weeks to submit its reply to the show cause notice. Following this, a fresh order is to be passed after affording an opportunity of personal hearing, expeditiously, preferably within three months. The ratio decidendi is that a taxpayer whose registration is cancelled cannot be expected to receive notices electronically through the GST portal for periods preceding the cancellation, especially when no physical notice is served, as this violates principles of natural justice.

Key Issues

1. Whether the petitioner was obligated to visit the GST portal to receive show cause notices for the period April 2018 to March 2019, given the cancellation of its GST registration effective March 31, 2021, and the absence of any revival of such registration (turning on principles of natural justice and relevant procedural rules for notice delivery). Petitioner's contentions: The petitioner argued that since its GST registration was cancelled and not revived, it was not required to monitor the GST portal for notices pertaining to a period prior to the cancellation, especially when no physical notice was served. The petitioner relied on the principle that a party cannot be expected to receive notices through a system from which their registration has been terminated. Revenue's contentions: The revenue did not contend that the petitioner's registration was revived or that the petitioner sought revival. It also did not claim that any physical/offline notice was issued or served on the petitioner before the impugned order. The judgment does not record specific arguments from the revenue regarding the petitioner's obligation to check the portal.