GST Update

 Desk of CA. Praveen Sharma – 931 Series (CAPS) 

Madras High Court in the Case of Nagappa Textiles

The Madras High Court recently passed an important order in the case of Nagappa Textiles, where the taxpayer had challenged a GST assessment order dated 31.12.2024.

In this case, the tax department had uploaded notices on the GST portal. However, no personal hearing was granted before passing the final order. The taxpayer argued that since the notices were only available on the portal and not otherwise communicated, they were unaware of the proceedings and could not submit a reply.

The High Court observed that the order was passed ex parte without giving an opportunity of personal hearing. This was considered a violation of the principles of natural justice. The Court clarified that although uploading notices on the GST portal is a valid mode of service, if there is no response from the taxpayer, the officer should try alternative modes of service as prescribed under Section 169 of the GST Act, such as sending notices through registered post.

The Court also noted that passing ex parte orders without ensuring proper service leads to unnecessary litigation.

Considering the facts, and as the taxpayer agreed to deposit 25% of the disputed tax, the Court set aside the order and remanded the matter back to the department to grant a personal hearing and pass a fresh order on merits.


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Regards
CAPS