The Madras High Court (Madurai Bench) recently clarified that uploading of the impugned order in the GSTN portal alone is not sufficient, and the limitation for filing an appeal under Section 107 of the TNGST Act shall begin from the date of receiving the order, and would not start running from the date of uploading. The Court said that while uploading the order in the portal is mandatory under Rule 142 of the Tamil Nadu GST Rules, 2017, this alone might not be sufficient in certain circumstances.
Taking judicial notice of the digital divide, a Single Judge Bench of Justice G.R. Swaminathan observed that when it comes to small businesses, which constitute the overwhelming majority, returns are usually filed by consultants hired by taxpayers who take nominal fees. In many cases, after registration is cancelled, there is no occasion to even access the portal.
The Single Judge distinguished between “service” and “communication”, noting that Section 107(1) of the TNGST Act states that limitation runs from the date on which the decision or order is “communicated” to the person, not “served”. Additionally, when a statute employs two different expressions, they denote different meanings, and the expressions “served” and “communicated” are not synonymous.
The Bench clarified that, since in the present case, the impugned order had only been uploaded in the portal and not communicated to the taxpayer, the limitation period shall not start running. Further, the taxpayer appears to have downloaded the impugned orders from the portal for the purpose of filing this petition, and that would not constitute communication of the order to the petitioner.
The Bench went on to observe that communication is always a bipartite affair, and service becomes communication if the authority reaches out to the taxpayer. This can be done by giving directly, sending by registered post, or sending to the last known address. However, mere uploading in the portal by no stretch of imagination would satisfy the requirement of communication, as there is no obligation cast on the taxpayer to access the portal. The Bench directed the Department to communicate the impugned orders to the petitioner, making it open for the petitioner to file appeals under Section 107 of the Act.
Briefly, in this case, the petitioner was subjected to surprise inspections at its business premises, resulting in the issuance of show cause notices under Section 74 of the TNGST Act demanding GST, which later culminated in an order levying tax, interest, and penalty in Form GST DRC-07. Since the impugned orders were never served upon them physically, and were only uploaded on the GSTN Portal, due to a lack of proper service, the petitioner missed the three-month limitation period under Section 107 of the TNGST Act for filing appeals. This was opposed by the respondent, contending that uploading orders on the portal constituted valid service and the limitation period commenced from the date of uploading, making the appeals time-barred.
Appearances:
Advocates S. Jaikumar and Nitin Chopra, for the Petitioner/ Taxpayer
Advocate Sureshkumar, for the Respondent/ Revenue
