Vasantham Agencies vs. The State Tax Officer (St) Ii (Inspn)

Held

The Court held that the assessment order dated 06.09.2024 was liable to be quashed. The reasoning was based on the non-compliance with Section 169 of the TNGST Act, which mandates specific modes of service for notices and orders to ensure adherence to the principles of natural justice. The Court referred to its previous judgment in WP(MD)No.26481 of 2024 etc., batch, which clarified that Section 169 requires service in person, by registered post, or by email as alternative modes, and only upon failure or impracticability of these modes can other methods like publication on the portal be resorted to. The Court found that the respondent's admission of serving notice solely through the respondent portal was a clear violation of Section 169. Consequently, the impugned assessment order was quashed and treated as a show cause notice. The petitioner was granted liberty to file a reply by 22.02.2025, after which the respondent was directed to afford a personal hearing and pass a fresh order on merits.

Facts

The petitioner, Vasantham Agencies, challenged an assessment order dated 06.09.2024 for the assessment year 2021-22, passed by the respondent, The State Tax Officer (ST)-II (Inspn.). The respondent had conducted an inspection under Section 67 of the Tamil Nadu Goods and Service Tax Act, 2017 (TNGST Act) from 20.02.2023 to 23.02.2023, recorded the petitioner's statement, and subsequently raised a demand for tax and penalty. The petitioner contended that they were not served with any notice seeking explanation for the alleged defects detected during the inspection. The respondent admitted that the petitioner was not served notice in compliance with Section 169 of the TNGST Act, having only served it through the respondent portal.

Key Issues

1. Whether the assessment order dated 06.09.2024 is liable to be quashed for non-compliance with the mandatory service requirements stipulated under Section 169 of the TNGST Act, thereby violating the principles of natural justice? The petitioner argued that Section 169 of the TNGST Act mandates service of notice in person, by registered post, or by email, and that failure to comply with these modes renders the assessment order unsustainable. They relied on a previous judgment of the High Court in WP(MD)No.26481 of 2024 etc., batch, dated 06.01.2025, which interpreted Section 169. The respondent, through the Additional Government Pleader, conceded that notice was not served in compliance with Section 169 of the TNGST Act, admitting that it was served only through the respondent portal.