The Allahabad High Court has reaffirmed that the right to be heard is not a mere formality but a statutory imperative in GST adjudication proceedings, particularly when a taxpayer’s registration has been cancelled. The judgment invalidates an adjudication order issued without physical service of notice, establishing a clear procedural safeguard for taxpayers rendered unable to access the Common Portal.
Background & Facts
The Dispute
The petitioner, M/S K And Company, was a registered taxpayer under the Uttar Pradesh Goods and Services Tax Act, 2017. Its registration was cancelled by order dated 23.06.2025. Subsequently, a show cause notice dated 25.09.2025 was issued for alleged tax evasion and irregularities in input tax credit claims. The notice was served exclusively through electronic means by uploading it on the Common Portal. No physical copy was dispatched to the petitioner’s registered address or any other known communication channel.
Key Facts
- Petitioner’s GST registration was cancelled on 23.06.2025
- Show cause notice dated 25.09.2025 was issued and uploaded on the Common Portal only
- Petitioner had no access to the Common Portal after cancellation of registration
- No physical notice, letter, or courier was sent to the petitioner’s registered or known address
- Adjudication order dated 30.12.2025 was passed ex parte, imposing penalties and demand of tax without any reply or hearing
- Petitioner became aware of the order only through third-party sources after its issuance
Procedural History
- 23.06.2025: GST registration of petitioner cancelled by the tax department
- 25.09.2025: Show cause notice issued electronically via Common Portal only
- 30.12.2025: Adjudication order passed without any reply or hearing from petitioner
- 15.01.2026: Petitioner filed Writ Tax Petition No. 2398 of 2026 before the High Court
- 04.05.2026: Hearing concluded before the Division Bench
The Parties' Positions
For the Petitioner: Argued that after cancellation of registration, the taxpayer is legally disabled from accessing the Common Portal. Service of notice through electronic mode post-cancellation is ineffective and violates the principles of natural justice. Relied on M/S Bambino Agro Industries Ltd. v. State of Uttar Pradesh & Anr. (2025:AHC:229995-DB) to establish that physical service is mandatory in such cases.
For the Respondent: Contended that service through the Common Portal was valid under the general provisions of the GST Act and that the petitioner had sufficient opportunity to monitor its portal account. Argued that the petitioner’s failure to check the portal was its own negligence.
Relief Sought
The petitioner sought quashing of the adjudication order dated 30.12.2025, setting aside the demand and penalty, and directing issuance of a fresh notice in physical mode with full opportunity to be heard.
The Legal Issue
The central question was whether service of a show cause notice in GST adjudication proceedings, after cancellation of registration, is valid if issued solely through electronic means on the Common Portal, or whether Section 75(4) of the U.P.G.S.T. Act, 2017, read with Section 169(1)(a)(b), mandates physical service when the taxpayer is no longer able to access the portal.
Arguments Presented
For the Petitioner
The petitioner relied on the binding precedent in M/S Bambino Agro Industries Ltd. v. State of Uttar Pradesh & Anr., which held that once registration is cancelled, the taxpayer is no longer obligated to monitor the Common Portal and cannot be expected to respond to notices posted there. The petitioner emphasized that Section 75(4) guarantees the right to be heard, and Section 169(1)(a)(b) permits service by post or personal delivery. Electronic service, it was argued, becomes legally impossible after cancellation, rendering the notice void ab initio. The failure to serve physically was a fundamental breach of natural justice.
For the Respondent
The State contended that the Common Portal is the primary and statutory channel for all GST communications, and that the petitioner’s failure to maintain access was a self-inflicted disability. It argued that the notice was deemed served under the general provisions of the Act and that no statutory mandate required physical service post-cancellation. The State also claimed that the petitioner had ample opportunity to approach the court earlier if it had been unaware of the notice.
The Court's Analysis
The Court rejected the State’s contention outright, holding that the very purpose of cancellation is to sever the taxpayer’s access and obligations under the portal system. The Court observed that the State’s own precedent in Bambino Agro Industries had already settled the principle that physical service is mandatory in such circumstances.
"Once the registration is cancelled and the registered persons thus disabled from working on the Common Portal and in any case, are relieved of obligation to check the Common Portal thereafter, it is wholly natural and practical that any adjudication notice issued after cancellation of registration may be served physically in terms of the provisions of Section 169(1)(a)(b) of the U.P.G.S.T. Act, 2017."
The Court further held that Section 75(4) is not a procedural formality but a substantive right. Denial of opportunity to be heard at the adjudication stage renders the entire proceeding void. The Court noted that the respondents had not even attempted to serve the notice by post or through personal delivery, despite having the petitioner’s registered address and prior correspondence history.
The Court emphasized that the doctrine of natural justice is not suspended merely because a taxpayer’s registration has been cancelled. The State cannot rely on technicalities to bypass statutory obligations. The failure to serve physically was not a mere irregularity but a jurisdictional defect.
The Verdict
The writ petition succeeded. The Court set aside the adjudication order dated 30.12.2025. The matter was remitted to the respondent no. 2 to issue a fresh notice through physical mode, along with copies of the Relied Upon Documents, within ten days. The petitioner shall have two weeks from receipt of the fresh notice to file a written reply. The respondent shall provide at least fifteen days’ advance notice for hearing, and the proceedings shall conclude within two months of the petitioner’s reply. No adjournments shall be permitted if the petitioner cooperates.
What This Means For Similar Cases
Physical Notice Is Non-Negotiable After Registration Cancellation
- Practitioners must immediately challenge any adjudication order issued post-cancellation without physical service
- The burden shifts to the department to prove physical service was attempted, not on the taxpayer to prove non-receipt
- Electronic service alone is legally insufficient after cancellation under Section 169(1)(a)(b)
Natural Justice Overrides Technical Compliance
- The right to be heard under Section 75(4) is a statutory right, not a discretionary privilege
- Courts will not uphold orders where the taxpayer was rendered incapable of responding due to administrative action (e.g., cancellation)
- Failure to serve physically constitutes a jurisdictional flaw, not a curable irregularity
Procedural Deadlines Are Binding on Authorities
- The Court’s directive for a 10-day notice window, 2-week reply period, and 2-month conclusion timeline sets a new benchmark for procedural efficiency
- Tax authorities must now plan adjudication timelines around these fixed windows
- Petitioners can now invoke this judgment to resist indefinite delays in post-cancellation proceedings
