2024 (3) TMI 1392 - HC - GST

Challenge to SCN as also the impugned order - SCN as also the assessment order have not been signed by the 1st respondent either digitally or physically as is otherwise required under Rule 26 of the Central Goods and Services Taxes Rules - HELD THAT - A reading of Section 160 of the Act makes it very much clear and candid that the safeguards contained therein cannot be made applicable for the contingency in the present case. Section 169 of the Act which deals with the service of notice enables the department to make available any decision order 4 Summons Notice or other communication in the common portal. In the guise of the same the signatures cannot be dispensed with. In the considered opinion of this court the aforesaid provisions of law would not come to the rescue of the respondent herein for justifying the impugned action. Conclusion - An unsigned order is no order in the eyes of law. Merely uploading of the unsigned order may be by the Authority competent to pass the order would not cure the defect which goes to the very root of the matter i.e. validity of the order. Petition allowed.

Summary

1. ISSUES PRESENTED and CONSIDERED

The judgment primarily addressed the following legal issues:

• Whether the Order-in-Original issued by the 1st respondent under the CGST/TGST Act, 2017, is void due to the lack of a signature.
• Whether the extension of time limits for passing orders, as per the notifications issued by the respondents, is ultra vires to the CGST/TGST Act, 2017, and violative of constitutional provisions.

2. ISSUE-WISE DETAILED ANALYSIS

Issue 1: Validity of the Unsigned Order-in-Original

• Relevant legal framework and precedents: The court considered Rule 26 of the CGST Rules, 2017, which mandates that orders must be signed either digitally or physically. The court also referenced Section 160 and Section 169 of the CGST Act, 2017, and previous judgments from the Andhra Pradesh High Court, Bombay High Court, and Delhi High Court.
• Court's interpretation and reasoning: The court interpreted that an unsigned order does not meet the legal requirements and is therefore invalid. It emphasized that the absence of a signature is a fundamental defect that cannot be cured by merely uploading the order on a digital portal.
• Key evidence and findings: The court noted that the Department did not provide satisfactory reasons for the lack of a signature on the order. It relied on similar cases where courts held that unsigned orders lack legal standing.
• Application of law to facts: The court applied Rule 26 of the CGST Rules, 2017, to determine that the unsigned Order-in-Original was not validly issued and thus could not be enforced.
• Treatment of competing arguments: The petitioner's argument that the unsigned order was void was upheld, while the Department's lack of a satisfactory explanation weakened its position.
• Conclusions: The court concluded that the Order-in-Original was void due to the absence of a signature, rendering it unsustainable in law.

Issue 2: Legality of the Extension of Time Limits

• Relevant legal framework and precedents: The court examined the provisions of Section 73(10) and Section 168A of the CGST Act, 2017, alongside constitutional articles 14, 19(1)(g), 21, and 265.
• Court's interpretation and reasoning: The court did not delve deeply into this issue due to the resolution of the first issue, but it left the door open for the authorities to reconsider the matter if necessary.
• Key evidence and findings: The court did not provide detailed findings on this issue as the primary focus was on the unsigned order.
• Application of law to facts: The court noted the potential ultra vires nature of the notifications but did not make a definitive ruling on this point.
• Treatment of competing arguments: The court acknowledged the petitioner's concerns but did not fully address the arguments due to the resolution of the first issue.
• Conclusions: The court allowed the possibility for the respondents to issue a fresh notice if they wished to proceed on different grounds.

3. SIGNIFICANT HOLDINGS

• Preserve verbatim quotes of crucial legal reasoning: "An unsigned order is no order in the eyes of law. Merely uploading of the unsigned order, may be by the Authority competent to pass the order, would, in our view, not cure the defect which goes to the very root of the matter i.e. validity of the order."
• Core principles established: The necessity of a signature for the validity of an order under the CGST/TGST Act, 2017, was reaffirmed. The court emphasized that procedural requirements such as signing cannot be overlooked.
• Final determinations on each issue: The court set aside the unsigned Order-in-Original as void and left open the possibility for the respondents to take appropriate steps in accordance with the law.

The judgment underscores the importance of adhering to procedural requirements in administrative actions under the CGST/TGST Act, 2017, and affirms the invalidity of unsigned orders. The court's decision reflects a consistent judicial approach to ensuring compliance with statutory mandates.