Facts of the Case

M/s Shukla Auto Mobiles' GST registration under the Uttar Pradesh Goods and Services Tax Act, 2017 was cancelled on 31.05.2022, after which the firm carried on no further business. Despite this, a show cause notice was uploaded solely on the GST portal, and the Deputy Commissioner, State Tax, Sector-1, Mirzapur, subsequently passed an order dated 10.02.2025 under Section 73 of the Act confirming a demand against the petitioner. The petitioner challenged this order before the Allahabad High Court under Article 226, contending that it was never obligated to keep checking a portal linked to a registration that had already been cancelled nearly three years earlier.

Issues Involved

  1. Whether a taxpayer whose GST registration stands cancelled is obligated to continue monitoring the GST portal for notices issued after cancellation.
  2. Whether service of a Section 73 show cause notice solely by portal upload, without any alternate mode, satisfies the requirements of natural justice in such circumstances.
  3. Whether the resultant Section 73 order deserves to be quashed on this ground alone, with liberty to the Department to issue a fresh notice.

Petitioner's Arguments

  • The petitioner submitted that once its GST registration had been cancelled in 2022, it was not obligated to check the GST portal for any subsequent notice, since it no longer had any operative reason to access it.
  • The mode of service of any show cause notice in such circumstances had to be by way of alternative means directly reaching the petitioner, not merely a portal upload.
  • Reliance was placed on the coordinate Bench decision in M/s Katyal Industries v. State of U.P. (Neutral Citation No. 2024:AHC:23697-DB), which had accepted an identical principle.

Respondent's Arguments

  • The State's counsel did not seriously dispute the underlying facts and left the legal question to be decided on the basis of the coordinate Bench precedent cited by the petitioner.

Court Order / Findings

  • The Court expressed complete agreement with the principle enunciated in M/s Katyal Industries — that once registration has been cancelled, the taxpayer is not obligated to check the GST portal, and service by alternate means becomes necessary.
  • Finding that service of the show cause notice solely through the GST portal, without any alternate mode, amounted to a violation of the principle of natural justice, the Court quashed and set aside the impugned order dated 10.02.2025 passed under Section 73 of the Act.
  • The Department was left at liberty to issue a proper notice to the petitioner through an alternate mode of service and proceed afresh in accordance with law, and the writ petition was disposed of on this direction.

Important Clarification

  • Once GST registration is cancelled, the taxpayer cannot be presumed to monitor the common portal, and a show cause notice served exclusively through the portal will not amount to valid service.
  • The onus shifts to the Department to use alternate modes of service — such as registered post or direct communication — once it is aware that the registration stands cancelled.
  • This principle, first articulated in Mahaveer Trading Company/Katyal Industries line of cases, is now being consistently applied by the Allahabad High Court across similarly-facted writ tax petitions.

Sections Involved

  • Section 73 of the Uttar Pradesh Goods and Services Tax Act, 2017 – the provision under which the demand order under challenge was passed.
  • Section 169 of the UPGST Act, 2017 – governs the permissible modes of service of notices, central to the finding of improper service.

Decision – In Favour of

In favour of the assessee — the Section 73 order was quashed for improper service, with liberty to the Department to issue a fresh notice by alternate means.

Case Details

Court: High Court of Judicature at Allahabad
Case No.: Writ Tax No. 4824 of 2025
Coram: Hon'ble Shekhar B. Saraf, J. and Hon'ble Praveen Kumar Giri, J.
Date of Order: 23.09.2025

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