HC Remanded Matter for Re-Adjudication Since Assessee Was Unaware of SCN Due to Non-Access of GST Portal After Closing Business

Case Details: Swastik Enterprises v. Union of India - [2024] 162 taxmann.com 536 (Delhi)

Judiciary and Counsel Details

• Sanjeev Sachdeva & Ravinder Dudeja, JJ.
• Vineet Bhatia, Aamnaya Jagannath Mishra, Keshav Garg & Bipin, Advs. for the Petitioner.
• Kshitij Chhabra, Sr. Panel Counsel, Rajeev Aggarwal, ASC & Ms Samridhi Vats, Adv. for the Respondent.

Facts of the Case

The petitioner had closed his business in 2020 and it did not check the GST portal. The department issued show cause notice (SCN) proposing demand but the SCN was uploaded only on the portal and was not communicated to the petitioner through any other means. Consequently, the petitioner was not able to furnish a reply against the impugned SCN and ex-parte order was passed by the department.

The petitioner filed writ petition and contended that it was unaware of any proceedings initiated against it and the demand was raised without providing an opportunity to file reply.

High Court Held

The Honorable High Court noted that the impugned order was passed and it was mentioned in the order that another opportunity to submit reply for the sake of natural justice opportunity for Personal Hearing, as per provisions of Section 75(4) of CGST Act, was also provided to the taxpayer by issuing “REMINDER” though the GST portal. However, the petitioner did not access the portal due to closure of business and could not reply to the said Show Cause Notice.

Therefore, the Court held that since the only reason for passing the impugned order was that petitioner had not filed any reply/explanation, one opportunity needs to be granted to the petitioner to respond to the Show Cause Notice and the matter was liable to be remitted to the Proper Officer for re-adjudication.