GST Registered Firm Cannot Claim Ignorance of GST Provisions or Rules, Service via GST Portal is Valid: Madras HC [Read Order]

In an important ruling, the Madurai bench of Madras High Court upheld the service of notices through GST port is valid and observed that a registered GST firm cannot plead ignorance of the GST Act or its rules made thereunder.

The petitioner, M/s. Mohana Constructions, had challenged an assessment order dated 06.08.2024 pertaining to the assessment year 2019-20, claiming that the impugned order was passed without adhering to the principles of naturaljustice.

It was contended that the statutory notices such as ASMT-10, DRC-01, and multiple personal hearing notices were not served physically but only through the GST portal, and thus the petitioner remained unaware of the proceedings.

Justice C. Saravanan, rejected the petitioner's argument, observing that since the firm was registered under the GST enactments, it was expected to be fully aware of the modes of communication prescribed under the law.

The Court held that “service of notice through GST portal is sufficient” and the petitioner cannot escape liability or procedural requirements by citing non-receipt of physical copies.

It noted that “It is noticed that the petitioner is a registered Firm under the provisions of the respective GST enactments and therefore, cannot plead the ignorance of the procedure under the provisions of the respective GST enactments and the Rules made thereunder. Service of notice through GST portal is sufficient for the respondent to proceed further under the provisions of the respective GST enactments.”

However, in the interest of justice and considering the consistent approach of the High Court in similar matters, the impugned order was quashed conditionally. The Court directed the petitioner to deposit 25% of the disputed tax amount within 30 days.

It further clarified that the quashed order shall be treated as an addendum to the earlier issued DRC-01 dated 16.05.2024. After paying deposits, the court directed the assessing authority to pass a fresh order on merits within three months.

The court also clarified that failure to comply would result in the writ petition being deemed dismissed, and the department would be free to enforce the original order.

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