M/S Light Group vs. The State Of Madhya Pradesh

Held

The Court held that the petitioner had made out a case that they missed the Show Cause Notice due to its placement under the "Additional Notices" tab on the GST portal. This lack of proper notification prevented them from responding to the notice, leading to the demand being created without their participation. The Court found that while the impugned order noted the taxpayer's failure to reply or appear, the underlying cause was the insufficient service of the notice. Consequently, the Court set aside the impugned order dated 19.06.2024. The respondents were directed to open the portal to allow the petitioner to file a response to the Show Cause Notice (Form GST DRC-01) within two weeks. Thereafter, the Proper Officer was to re-adjudicate the Show Cause Notices after providing an opportunity for a personal hearing and passing fresh speaking orders within the period prescribed under Section 75(3) of the Act. The Court explicitly clarified that it had not considered or commented on the merits of the contentions of either party.

Facts

The petitioner, M/s Light Group, challenged an order dated 19.06.2024 passed under Section 73 of the Central Goods and Services Tax Act, 2017, creating a demand against them. The petitioner contended that they were unaware of the order as the Show Cause Notice was uploaded on the GST portal under the category of "Additional Notices" and not communicated through other modes. They argued that this placement made the notice difficult to find, leading to their inability to respond within the stipulated time. The petitioner relied on several High Court judgments, particularly from the Madras High Court, which had previously highlighted issues with the GST portal's architecture regarding the placement of notices.

Key Issues

1. Whether the placement of the Show Cause Notice under the "Additional Notices" tab on the GST portal, without other modes of communication, constitutes sufficient service and adherence to the principles of natural justice, considering the specific architecture of the web portal? (Question of law and mixed fact and law, turning on principles of natural justice and procedural fairness under the CGST Act, 2017). Petitioner's arguments: The petitioner argued that the notice was not effectively served as it was uploaded under "Additional Notices" and not the primary "View Notices and Orders" section, making it easily missed. They relied on judgments from the Madras High Court (East Coast Constructions and Industries Ltd. v. Assistant Commissioner (ST), Sabari Infra (P.) Ltd. v. Asstt. Commissioner (ST), Murugesan Jayalakshmi v. State Tax Officer) and the Delhi High Court (Umang Realtech (P.) Ltd v. Union of India, Anhad Impex and another Vs. Assistance Commissioner) which held similar placements as insufficient service and a violation of natural justice. Revenue's arguments: The judgment records no specific arguments from the respondents/State.