Facts of the Case

M/S Cramster Gear Co., whose GST registration had already been cancelled on the petitioner's own application, sought a copy of a show cause notice in Form GST DRC-01 dated 14.12.2023 for tax period 2018-19, contending it was never served. Proceedings nonetheless culminated in an order dated 03.04.2024 under Section 73(9), a summary order in Form GST DRC-07, and an appellate order dated 19.05.2025 in Form GST APL-02 dismissing the appeal. The petitioner had earlier filed Form GST REG-16 intimating an e-mail address for future correspondence.

Issues Involved

  1. Whether service of the show cause notice by e-mail and portal upload, and by registered post returned as 'insufficient address', amounted to valid service.
  2. Whether a taxpayer whose registration stood cancelled could reasonably be expected to monitor the GST portal for notices.

Petitioner's Arguments

  • The grievance was that after the petitioner's application for cancellation of GST registration was allowed, a show cause notice was issued but never served, and the proceedings culminating in the demand and appellate orders were passed without proper service.
  • An application in Form GST REG-16 had informed the Department of the address, including an e-mail ID, for future correspondence, which the Department failed to use effectively.

Respondent's Arguments

  • Show cause notices were sent by e-mail to the address available with the Department and were also uploaded to the portal, despite which the petitioner did not appear.
  • A notice sent by registered post was returned with an endorsement of 'insufficient address'.

Court Order / Findings

  • The Court held that since the petitioner's GST registration had already been cancelled, it could not be expected to visit the portal to check for fresh notices, and the registered-post notice having been returned as undelivered, service could not be said to be complete.
  • Finding service of the show cause notice deficient, the Court quashed the order dated 03.04.2024, the Form DRC-07 summary order and the appellate order in Form GST APL-02, and permitted the petitioner to reply to the show cause notice within 15 days, with the Department to proceed afresh from that stage.
  • The writ petition was partly allowed on these terms.

Important Clarification

  • Once a taxpayer's GST registration is cancelled, the taxpayer cannot be presumed to be checking the GST portal regularly, so portal-upload service alone may not suffice for that class of taxpayers.
  • Registered post returned with an 'insufficient address' endorsement does not constitute completed service, especially where the taxpayer has separately intimated a correct address via Form GST REG-16.

Sections Involved

  • Section 73(9), CGST Act, 2017 – determination of tax demand for reasons other than fraud.
  • Form GST DRC-01, Form GST DRC-07 and Form GST APL-02 – prescribed forms for show cause notice, summary demand order and appellate order respectively.

Decision – In Favour of

Decided in favour of the assessee. The demand and appellate orders were quashed for defective service, with liberty to reply and a fresh adjudication directed.

Case Details

Court: High Court of Karnataka at Bengaluru
Case No.: WP No. 20704 of 2025 (T-RES)
Coram: Hon'ble Mr. Justice Suraj Govindaraj
Date of Order: 16.07.2025

Link to Download the Order

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