2025 (1) TMI 517 - HC - GST

Service of notice - compliance of Section 169 of the Tamil Nadu Goods and Services Tax Act 2017 or not - It is the contentions of the petitioners that the respondents in each of the cases had uploaded only the notices/ orders in the web portal and not by any other modes as prescribed under Section 169 of the Act - HELD THAT - Having perused section 31 of the TNGST Act and rule 52 (1) of the Rules made thereunder, it is not inclined to accede to the submissions of the learned counsel for the petitioner that only after resorting to the service of notice in person, service through registered post was permissible. A reading of rule 52 (1), makes it clear that the set of expressions in the first part of rule 52 (1), viz., may be effected in any of the following ways makes it amply clear that the service of notice on a dealer can be resorted to by any one of the modes specified in rule 52 (1) (a), (b), (c). Only sub-rule 52 (1) (d) specifies that if none of the modes provided under rule 52 (1)(a), (b), (c) is practicable, the alternative mode of affixing notice in some conspicuous place at the last known business or residence can be resorted to. As far as the modes of service specified in rule 52 (1) (a), (b), (c) are concerned, it is for the authorities concerned to resort to anyone of the modes specified therein. Coming to Section 169 (1), it is to be noted that a learned Single Judge of this Court in a judgment in the case of Pandidorai Sethupathi Raja Vs Superintendent of Central Tax, Chennai 2022 (12) TMI 1028 - MADRAS HIGH COURT had held that it is the obligation of the assessee to visit the portal and therefore, posting of summons and orders through portal is a sufficient compliance of notice on the assessee and therefore, there is no necessity for any alert. The learned single Judge had also compared the explanation of (r) to (u) of Section 144B of the Income Tax Act which had mandated an alert either to the registered e-mail ID of the assessee or by way of SMS to the registered mobile number of the assessee. Conclusion - Section 169 mandates a notice in person or by registered post or to the registered e-mail ID alternatively and on a failure or impracticability of adopting any of the aforesaid modes, then the State can, in addition, make a publication of such notices/ summons/ orders in the portal/ newspaper through the concerned officials. The orders of assessment impugned in these Writ Petitions are set aside. Petition allowed.

Summary

1. ISSUES PRESENTED and CONSIDERED

The core legal questions considered in this judgment include:

• Whether the service of notices solely through the web portal complies with Section 169 of the Tamil Nadu Goods and Services Tax Act, 2017.
• Whether the modes of service prescribed under Section 169(1) should be read conjunctively or disjunctively.
• Whether the principles of natural justice are violated by not employing alternative modes of service alongside the portal notification.
• Whether the existing legal precedents support the validity of service through the portal as a sufficient mode of notice.
• Whether the respondents provided an efficacious alternative remedy for the petitioners regarding the service of notices.

2. ISSUE-WISE DETAILED ANALYSIS

Issue 1: Compliance with Section 169 of the Tamil Nadu Goods and Services Tax Act, 2017

• Relevant legal framework and precedents: Section 169 of the Act outlines various methods for serving notices, including direct delivery, registered post, email, and portal posting. The court also considered precedents from other judgments, including those from the Madras High Court and the Apex Court.
• Court's interpretation and reasoning: The court determined that the modes of service under Section 169(1) should be read as alternatives, not conjunctively. The court emphasized that the principles of natural justice require effective service of notice to the assessee.
• Key evidence and findings: The court noted that many petitioners were unaware of portal updates due to reliance on practitioners who failed to inform them. The court found this lack of awareness problematic for ensuring compliance with natural justice principles.
• Application of law to facts: The court applied the law by interpreting Section 169 to require alternative modes of service beyond just portal posting, particularly when it is impractical to use other methods.
• Treatment of competing arguments: The respondents argued that portal service was sufficient, citing previous judgments. However, the court found these arguments unpersuasive, emphasizing the need for alternative service methods to uphold natural justice.
• Conclusions: The court concluded that the service of notices solely through the portal did not comply with Section 169 and violated the principles of natural justice.

Issue 2: Validity of Service through the Portal as a Sufficient Mode of Notice

• Relevant legal framework and precedents: The court examined various judgments, including those from the Madras High Court and other jurisdictions, to assess the sufficiency of portal service.
• Court's interpretation and reasoning: The court distinguished the present case from others where additional modes of service were employed, finding portal service alone insufficient.
• Key evidence and findings: The court highlighted the lack of alerts or notifications to the registered email or phone numbers of the assessees, which contributed to the insufficiency of portal service.
• Application of law to facts: By comparing the facts of this case with previous judgments, the court determined that portal service without additional notification methods was inadequate.
• Treatment of competing arguments: The respondents' reliance on previous judgments supporting portal service was countered by the court's emphasis on the need for comprehensive service methods.
• Conclusions: The court concluded that service through the portal alone did not meet the statutory requirements of Section 169.

3. SIGNIFICANT HOLDINGS

• Preserve verbatim quotes of crucial legal reasoning: "The State is obliged to comply with the Clauses (a) to (c) alternatively and thereafter, comply with Clauses (d) to (f)."
• Core principles established: The judgment established that the modes of service under Section 169 are alternative, and the principles of natural justice require effective notice to the assessee.
• Final determinations on each issue: The court set aside the impugned assessment orders, requiring the respondents to provide an opportunity for the petitioners to respond to show cause notices and to pass orders on merits following the law.

In conclusion, the court emphasized the importance of adhering to the principles of natural justice and ensuring that assessees are adequately informed through effective service of notices. The judgment underscores the necessity of using alternative modes of service when portal notification alone is insufficient, thereby reinforcing the statutory requirements of Section 169 of the Tamil Nadu Goods and Services Tax Act, 2017.