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2023 (2) TMI 132 - HC - GSTValidity of summary order - regularity of the adjudication proceedings - recovery proceedings - HELD THAT - The assessment proceedings suffer from serious procedural errors in absence of a proper show-cause notice. The summary of order issued in Form GST DRC-07 dated 21st January 2019 does not precede with a proper adjudication order either. Considering the ratio rendered by this Court in the case of M/S. NKAS SERVICES PRIVATE LIMITED. VERSUS THE STATE OF JHARKHAND, THE COMMISSIONER OF STATE TAXES, RANCHI, DEPUTY COMMISSIONER OF STATE TAXES, GODDA 2021 (10) TMI 880 - JHARKHAND HIGH COURT and the fact that there are serious discrepancies in the proceedings, the impugned summary of order contained in Form GST DRC-07 is set aside. The matter is remitted to the adjudicating authority respondent no.3 to proceed in accordance with law afresh after issuing a proper show cause notice. Petition allowed.
Issues:
1. Quashing of summary order and notices under GST Act 2. Refund of recovered amounts 3. Stay on recovery proceedings Analysis: Issue 1: Quashing of summary order and notices under GST Act The petitioner, engaged in solar power system business, challenged the summary order in Form GST DRC-07 dated 21.01.2019 and related notices as violative of CGST/JGST Act and principles of natural justice. The petitioner claimed lack of receipt of notices and sought copies through RTI. The Court directed the production of assessment records to verify the proceedings' regularity. The respondent argued delay in filing the petition and suppression of facts by the petitioner. The Court noted discrepancies in records and absence of an adjudication order, leading to doubts on the proceedings' regularity. Relying on a previous judgment, the Court found serious procedural errors and set aside the summary order, remitting the matter for fresh proceedings with a proper show cause notice. Issue 2: Refund of recovered amounts The petitioner sought a refund of amounts debited from electronic ledgers. The Court's decision to set aside the summary order implied a potential refund of the recovered amounts. However, the Court did not delve into the merits of the case, indicating that the refund issue might need further consideration during the fresh proceedings. The petitioner's claim for refund, along with interest, was intertwined with the quashing of the summary order and the need for proper adjudication proceedings. Issue 3: Stay on recovery proceedings The petitioner requested a stay on recovery proceedings pending the petition's disposal. The Court's decision to set aside the summary order and remit the matter for fresh adjudication implied a temporary halt on the recovery proceedings. The Court's order allowed the petitioner relief from coercive actions until final disposal of the petition, indicating a temporary stay on recovery activities. In conclusion, the High Court of Jharkhand, in a detailed analysis, quashed the summary order under GST Act due to serious procedural errors and lack of a proper show cause notice. The Court's decision implied potential refund of recovered amounts and a temporary stay on recovery proceedings, pending fresh adjudication. The judgment highlighted the importance of procedural regularity and adherence to principles of natural justice in tax assessment proceedings.
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