M/S White Placard Technologies Private Limited vs. State Of U.P. And 3 Others

Held

The Court held that the electronic issuance of show-cause notices on the common portal after the cancellation of the petitioner's GST registration, without ensuring physical service, was not proper. The Court acknowledged the Commissioner's Circular dated 07.05.2025, which emphasized the need for physical service of notices on taxpayers whose registrations have been cancelled, as such taxpayers may not be actively monitoring the common portal. The Court reasoned that once registration is cancelled, a taxpayer may not be obligated or even able to work on the portal, thus remaining unaware of proceedings. Consequently, the ex parte adjudication and penalty orders were deemed to be vitiated due to lack of proper notice. The Court set aside the impugned orders and directed the petitioner to file their reply to the show-cause notices within two weeks. The adjudicating authority was instructed to consider any applications for cross-examination or document supply, provide a personal hearing with advance notice, and pass a reasoned order within one month, concluding proceedings by 31.12.2026.

Facts

The petitioner, M/S White Placard Technologies Private Limited, challenged multiple adjudication and penalty orders passed by the Deputy Commissioner, State Tax, Ghaziabad. The core issue arose because the petitioner's GST registration was cancelled on 14.10.2019. Subsequently, show-cause notices for financial years 2017-18, 2018-19, and 2019-20 were issued electronically on the common portal on dates ranging from 04.09.2023 to 29.05.2024, and a penalty notice was issued on 15.01.2024. These proceedings were initiated more than three years after the cancellation of registration. The petitioner claimed they were unaware of these proceedings, which proceeded ex parte, and only learned of the penalty order dated 30.03.2026 upon receiving an SMS on 30.03.2026.

Key Issues

1. Whether show-cause notices issued electronically on the common portal for adjudication proceedings, initiated after the cancellation of a taxpayer's registration, are valid and constitute proper service, particularly when the taxpayer claims no awareness of such proceedings? (Section 73, Section 125, Section 127 of UPGST Act, 2017) Petitioner's contention: The petitioner argued that since their registration was cancelled on 14.10.2019, they were not obligated to monitor the common portal. The electronic show-cause notices, issued over three years later, were therefore not effectively served, leading to ex parte adjudication. They relied on the principle that a person whose registration is cancelled may not be aware of subsequent proceedings. Revenue's contention: The Standing Counsel conceded that in light of the Commissioner of Commercial Tax, U.P.'s Circular dated 07.05.2025, which mandated physical service of notice in such cases, there was no quarrel with the petitioner's proposition.