Facts of the Case

The petitioner, a Junior Assistant employed with the Roads and Buildings Department, challenged a recovery notice dated 06.05.2025 (Form GST DRC-13) issued to his banker for recovery of amounts due under an assessment order dated 03.07.2021 and a penalty order dated 31.07.2021, along with a VAT 206 notice dated 17.08.2023 that had earlier frozen his personal bank account. He sought quashing of the recovery notice, the VAT 206 notice, and the underlying assessment and penalty orders as void, arbitrary and violative of natural justice, contending that neither the assessment order nor the penalty order had ever actually been served on him.

Issues Involved

  1. Whether recovery proceedings can continue on the strength of assessment and penalty orders that were dispatched by registered post but returned undelivered.
  2. Whether, in such circumstances, the assessee should be granted liberty to pursue the statutory appellate remedy despite the ordinary limitation period having lapsed.

Petitioner's Arguments

  • The assessment order and penalty order were never served on the petitioner, and recovery on their strength, including freezing of his bank accounts, was therefore illegal.

Respondent's Arguments

  • The Government Pleader submitted that the show cause notice was sent electronically and the assessment order was sent by registered post, which was returned with an endorsement that the petitioner 'had left'; the burden of informing the department of any change of address lay on the petitioner, and the order sent by registered post ought to be treated as validly served.

Court Order / Findings

  • The Court observed that, prima facie, the department's contention regarding the burden to update address could not be disputed, but the undisputed fact remained that the order was not actually served on the petitioner.
  • In these circumstances, the Court found it appropriate to dispose of the writ petition by permitting the petitioner to file appeals against the Assessment Order and the Penalty Order within three weeks.
  • It was directed that, upon such appeals being filed, the Appellate Authority shall consider and dispose of them on merits, without taking into account the period of delay in filing.

Important Clarification

  • Even where the department has technically dispatched an assessment or penalty order by registered post in compliance with Section 169, if such dispatch is undisputedly returned unserved, courts will not treat the order as validly communicated for the purpose of denying an assessee the statutory appellate remedy.
  • In such situations, the appropriate relief is to permit a belated appeal to be filed and decided on merits without reference to the delay, rather than the High Court itself adjudicating the underlying assessment or penalty dispute in writ jurisdiction.
  • This approach also reflects a practical accommodation: the Court accepted, in principle, that an assessee bears responsibility for updating its address with the department, yet still declined to let an admittedly unserved order foreclose the statutory remedy altogether.

Sections Involved

  • Section 107, CGST/APGST Act, 2017 — appeal to the Appellate Authority against orders of assessment or penalty.
  • Section 169, CGST Act, 2017 — modes of service of notices and orders, including service by registered post.

Decision – In Favour of

Disposed of with directions, in favour of the Assessee — the appellate remedy was restored without reference to the limitation bar.

Case Details

High Court of Andhra Pradesh at Amaravati; WP No.15275 of 2025 and IA No.1 of 2025; Coram: Hon'ble Sri Justice R. Raghunandan Rao and Hon'ble Sri Justice T.C.D. Sekhar; Date of Order: 24.09.2025.

Link to Download the Order

Click here to view/download the full order

Disclaimer

This content is shared strictly for general information and knowledge purposes only. Readers should independently verify the information from reliable sources. It is not intended to provide legal, professional, or advisory guidance. The author and the organisation disclaim all liability arising from the use of this content. The material has been prepared with the assistance of AI tools.