Kiran Enterprises Vs State of U.P
Date: December 1, 2025
Subject Matter
Portal Notification Invalid After GST Registration Cancellation
Summary
The High Court has allowed the writ petition, quashing four separate assessment orders passed under Section 73 of the U.P. GST Act. The Court ruled that once a taxpayer's GST registration is cancelled, the Revenue cannot fulfill the requirement of "service of notice" by merely uploading a Show Cause Notice (SCN) to the GST portal, as the taxpayer is no longer obligated to monitor it.
Summary of Facts and Dispute:
Registration Status: The petitioner’s GST registration was cancelled on January 8, 2021. Following the cancellation, the petitioner ceased all business operations.
Impugned Action: The GST Department issued a Show Cause Notice (SCN) by uploading it to the GST portal. When the petitioner did not respond (unaware of the notice), the Department passed ex-parte orders on April 23, 2022, November 23, 2022, April 24, 2022, and February 13, 2025.
Legal Argument: The petitioner contended that since the registration was already dead, there was no reason to check the digital portal. Therefore, the "service" was defective, leading to a total violation of the principles of natural justice.
Key Legal Findings:
Invalid Mode of Service: The Court held that the GST portal is a communication tool for active registrants. Once a registration is cancelled, the Department is legally required to serve notices via alternative means (such as registered post or email to the last known address) to ensure the taxpayer is actually informed.
No Obligation to Monitor: A person whose registration has been cancelled is not expected or obligated to log into the GST portal to check for potential litigation.
Precedent Followed: The Court relied on the coordinate Bench decision in M/s Katyal Industries v. State of U.P., affirming that digital-only service post-cancellation is a procedural irregularity that strikes at the root of the assessment.
Ruling and Directions:
Orders Set Aside: All four assessment orders (dated 2022 and 2025) are quashed and set aside for violation of natural justice.
Liberty to Revenue: The GST Department is granted the liberty to re-initiate proceedings by issuing a fresh notice to the petitioner through valid, physical, or direct communication channels.
Compliance: Any future action must be taken strictly in accordance with the law and after providing the petitioner a fair opportunity to be heard.
FULL TEXT OF THE ORDER OF ITAT ALLAHABAD
1. Heard learned counsel for the parties and perused the record.
2. This is a writ petition under Article 226 of the Constitution of India wherein the petitioner is aggrieved by the orders dated April 23, 2022, November 23, 2022, April 24, 2022 and February 13, 2025 passed by the respondents, under Section 73 of the Uttar Pradesh Goods and Services Tax Act, 2017 (hereinafter referred to as “the Act”).
3. Factual matrix in the matter is that the petitioner’s registration under the Act was cancelled on January 8, 2021. Subsequent to the same, no business was carried out by the petitioner. It appears that a show cause notice was uploaded on the GST portal and subsequent to the same, the order impugned was passed under Section 73 of the Act.
4. Once the registration has been cancelled, the petitioner is not obligated to check GST portal. The mode of service of any show cause notice has to be by way of alternative means to the petitioner.
5. Counsel appearing on behalf of the petitioner relies upon an order passed by the coordinate Bench of this Court in M/s Katyal Industries v. State of U.P. and others, Neutral Citation No.2024:AHC:23697-DB. We are essentially in agreement with the said principle enunciated by the coordinate Bench in the said order.
6. We find that there has been violation of the principle of natural justice, and accordingly, the impugned orders dated April 23, 2022, November 23, 2022, April 24, 2022 and February 13, 2025 passed by the respondents are quashed and set aside. The department shall be at liberty to issue a proper notice to the petitioner and act in accordance with law.
7. With the above direction, the writ petition is disposed of.