Introduction
In a notable judgment reaffirming the importance of procedural fairness under GST, the Hon’ble Madras High Court has ruled that service of a Show Cause Notice (SCN) solely through the GST portal is not sufficient where the taxpayer has not responded. The Court held that reliance on digital service alone, without exploring other permissible modes under Section 169(1) of the CGST Act, 2017, constitutes a denial of natural justice. The order passed without proper service was accordingly set aside and remanded for fresh adjudication.
This decision provides critical clarity on the interpretation of Section 169 and offers a cautionary precedent for tax authorities initiating ex parte proceedings based only on portal uploads.
Case Details
Case: Tvl. Grace Metal Stores vs. State Tax Officer, Chennai
Court: Madras High Court
Date of Decision: 9 June 2025
Relevant Provision: Section 169(1), CGST Act, 2017
Key Issue
Whether service of an SCN only through the common GST portal is sufficient compliance under the CGST Act when the taxpayer does not respond.
Findings of the Court
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The Court held that uploading the SCN on the GST portal is only one of the recognised modes of service, and not sufficient in isolation if the taxpayer has not acknowledged or responded.
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Section 169(1) explicitly provides for other modes of service—such as registered post, personal delivery, and email—which must be reasonably explored before concluding the proceedings ex parte.
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In the absence of any effort by the department to serve the SCN through alternative modes, the Court found the adjudication process to be procedurally flawed.
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The order was quashed and the matter was remanded for fresh proceedings after ensuring valid service of notice in accordance with law.
Statutory Framework: Section 169(1), CGST Act
Recognised modes of service under Section 169(1) include:
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Delivery by hand or courier
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Registered or speed post
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Communication to the registered email address
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Uploading on the common portal
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Newspaper publication (where specifically warranted)
The judgment confirms that reliance on a single mode, especially digital, is not enough when it does not result in actual or constructive service.
Conclusion
The Grace Metal Stores decision underscores that effective service of notice is the bedrock of fair adjudication under GST. The safeguards under Section 169(1) are designed not merely for form, but to uphold the taxpayer’s right to be heard. While digital delivery mechanisms streamline administration, they do not absolve the revenue authorities from ensuring actual communication in cases of non-response. This judgment is expected to guide future conduct of assessments and offer relief in cases where procedural norms have been overlooked.
