2021 (4) TMI 1054 - HC - GST

Validity of authority of the summary order in FORM GST DRC-07 dated 18.02.2021 - challenge on the ground that the summary order is suffering from the vice of non-consideration of submissions made by the petitioner and this also is the case of serious breach of principles of natural justice - HELD THAT - The statutory provision of section 107 of CGVAT which provides for the appeal to the Appellate authority, if any person is aggrieved by the decision or order passed under CGST Act or the SGST Act or the UTGST Act by the adjudicating authority, within three months from the date on which the decision of the order is communicated to the person concerned. It is deemed appropriate and justifiable to relegate the Petitioner to the appellate authority prescribed under the statute without entering into the merits of the matter. All issues, which have been raised before the Court can be raised before the appellate Authority within the prescribed time of three months, raised in this petition, on seeking a reasoned order from the concerned authority. Let the reasoned order, if not already supplied to the petitioner, be provided within 07 days of the receipt of the copy of this order - Petition disposed off.

Summary

Issues: Challenge to summary order under Article 226 - Non-consideration of submissions - Breach of natural justice - Non-supply of detailed order - Appeal to appellate authority under section 107 of CGST Act.

Analysis:
1. The petitioner challenged a summary order in FORM GST DRC-07 dated 18.02.2021 under Article 226 of the Constitution, alleging non-consideration of submissions and breach of natural justice. The petitioner, a private limited company, received a show cause notice regarding the wrong availment of ITC during a specific period. The petitioner contended that the summary order demanding payment lacked consideration of detailed submissions made in response to the show cause notice. The petitioner sought to quash the proceedings for non-compliance with the prescribed procedure under section 74 of the CGST Act and Rule 142 of the Rules.

2. The petitioner approached the High Court seeking directions to set aside the summary order and stay recovery proceedings initiated by the respondent. The petitioner argued that the failure to provide a detailed order along with reasons for the substantial demand compelled them to seek relief from the Court. The petitioner prayed for appropriate writs to ensure compliance with procedural requirements and principles of natural justice.

3. The Court heard the petitioner's advocate, who highlighted the statutory provision of section 107 of the CGST Act, allowing appeals to the Appellate Authority within three months of the communicated decision or order. The advocate acknowledged the absence of a detailed order as a hindrance to filing an appeal. The Court directed the petitioner to seek a reasoned order from the adjudicating authority and pursue remedies through the appellate authority within the specified timeframe.

4. The Court refrained from delving into the merits of the matter and advised the petitioner to raise all issues before the appellate authority. Emphasizing the importance of following the statutory appeal process, the Court instructed the concerned authority to provide a reasoned order to the petitioner within seven days. The Court's decision aimed to facilitate the petitioner's access to a detailed order for pursuing further legal remedies through the appellate process.

5. The Court's order mandated the electronic sharing of the reasoned order with the petitioner within 24 hours via the provided email address. By choosing not to address the substantive issues raised in the petition due to the availability of an alternative remedy through the appellate authority, the Court disposed of the petition. The Court's decision underscored the significance of exhausting statutory appeal mechanisms before seeking judicial intervention, ensuring adherence to legal procedures and principles.