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TMI Blog2024 (10) TMI 279X X X X Extracts X X X X X X X X Extracts X X X X ..... No. 3912/2024; WP(C) No. 3910/2024; WP(C) No. 3933/2024; WP(C) No. 4618/2024 and WP(C) No. 4619/2024. I have also heard Mr. B. Gogoi, the learned Standing Counsel of the Finance and Taxation Department of the Government of Assam. 2. Before dealing with the issue involved, this Court finds it relevant to briefly note the facts involved in the instant batch of writ petitions which are taken up for adjudication. PROPOSITION OF FACTS AS PER PLEADINGS AND INSTRUCTIONS WP(C) No. 3912/2024 3. In this case, the petitioner was issued a Summary of the show cause in GST DRC-01 along with an attachment of the determination of tax on 28.09.2023 for the tax period 2017-18. The petitioner submitted a reply on 31.10.2023 stating inter-alia that the DGGI (CGST) had initiated proceedings of enquiry in 2020 in respect to the determination of tax regarding output liability and eligible ITC for the period covered under DRC-01. It was further mentioned that in terms with Section 6 (2) (b) of the Central Goods and Services Tax Act, 2017 (for short, 'the Central Act') parallel proceedings on the same subject matter cannot run, and as such, requested to drop the proceedings. In the said reply, the pe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ayer had not replied or contested the notice, and as such, had been agreed with the terms of the notice. It is relevant to mention that the attachments to both the GST DRC-01 as well as the GST DRC-07 did not contain any signature of the Proper Officer. WP(C) No. 4619/2024 6. In the this case, the petitioner herein was issued a Summary of the Show Cause Notice dated 28.09.2023 in the GST DRC-01. In the said Summary of the Show Cause Notice, it was mentioned that the Show Cause Notice was attached. Along with the said Summary of the Show Cause Notice, there was an attachment to the determination of tax dated 28.09.2023. The petitioner did not reply to the Show Cause Notice in view of the fact that there was no Show Cause Notice attached to the Summary of the Show Cause Notice. Pursuant thereto, a Summary of the Order dated 28.12.2023 was issued in GST DRC-07. To the said Summary of the Order uploaded in GST DRC-07, there was an attachment stating the manner in which the determination was made. The reason assigned for passing of the said order was that the taxpayer had not replied or contested the notice, and as such, had been agreed with the terms of the notice. It is relevant to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent authorities as to whether there were Show Cause Notices issued apart from the Summary of the Show Cause Notice in GST DRC-01, and further, as to whether there were Show Cause Notices attached as mentioned in the Summary of the Show Cause Notice in GST DRC-01. In reply to the above queries so made by this Court, affidavits have been filed as well as instructions placed that the Proper Officer had only issued the Summary of the Show Cause Notice in GST DRC-01 along with the determination of tax. There were no separate Show Cause Notices issued though reflected in Summary of the Show Cause Notices in GST DRC-01. During the course of the hearing, Mr. B. Gogoi, the learned Standing Counsel for the Finance and Taxation Department had placed an instruction issued by the Joint Commissioner of Taxes, Assam wherein it has been mentioned that the attachments to the GST DRC-01 is the Show Cause Notices and in the said attachments, the case of under declared tax amount were given along with reasons thereof in order to give the petitioners an opportunity to clarify his or their case of under declared tax etc. The said instruction is kept on record and marked with the letter "X". 10. In the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ivate Limited vs. State of Jharkhand & Others , reported in (2022) 99 GSTR 145, the learned Division Bench of the Jharkhand High Court had dealt with the question as regards issuance of a Summary of Show Cause Notice in GST Form DRC-01 and held that the Summary of the Show Cause Notice as issued in Form GST DRC-01 cannot be a substitute to the requirement of a proper Show Cause Notice. The learned counsel had also referred to another judgment of the Karnataka High Court in the case of LC Infra Projects Pvt. Limited vs. Union of India and Others , reported in (2020) 73 GSTR 248. 12. Ms. Nitu Hawelia, the learned counsel while supporting the submissions of Mr. A. Goyal, the learned counsel additionally submitted that in terms of Section 75 (4) of the Central Act as well as also the Assam Goods and Services Tax Act 2017 (herein after referred to as 'the State Act'), there is a requirement of giving an opportunity of hearing when a request is received in writing from the person chargeable with tax or penalty or where any adverse decision is contemplated against such person. The learned counsel submitted the materials on records which were placed by Mr. A. Goyal, the learned counsel, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e learned counsel, however, fairly submitted that there is no separate Show Cause Notice apart from the determination of tax enclosed to the Summary of the Show Cause Notice. On the question of lack of signatures in the attachments to the GST DRC-01 as well as the GST DRC-07, the learned counsel fairly submitted that the materials on record do not show that there is/are any signature(s) in the attachment to the Summary to the Show Cause Notice as well as Summary to the Order issued in Forms GST DRC-01 and GST DRC-07 respectively. He however submitted that in the attachments it is mentioned as 'Sd-Proper Officer'. The learned counsel further submitted that when the Summary of the Show Cause Notice as well as the Summary of the Order are uploaded in GST DRC-01 and GST DRC-07, the same are duly authenticated in the portal with digital signatures and without such authentication, the portal cannot be operated. ANALYSIS AND DETERMINATION 14. I have heard the learned counsels for the petitioners as well as the respondents. From the materials on record as well as the submissions so made by the learned counsels for the petitioners it appears that the petitioners have approached this Cour ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , the Proper Officer is required to issue a Show Cause Notice, therefore, the Show Cause Notice is required to specifically mention the reason(s) and the circumstances why the provision of Section 73 had been set into motion. The person against whom the said Show Cause Notice is issued would only have an adequate opportunity to submit a representation justifying that the prerequisites for issuance of Show Cause Notice is not there if and only if the reason(s) for issuance of the Show Cause is specifically mentioned in the Show Cause Notice. Section 73 further stipulates that upon consideration of the representations, if any, the Proper Officer shall pass the order under Section 73 (9) determining the amount of tax, interest and penalty. It is also apposite to mention that Section 73 (2) and Section 73 (10) are interconnected in as much as Section 73 (10) stipulates that within three years from the due date for furnishing the annual return for the financial year, the order under Section 73 (9) can be passed. In terms with Section 73 (2), the Show Cause Notice is to be issued within three months prior to the time limit prescribed in Section 73 (10). In addition to the above, it wo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of a Show Cause Notice is sine qua non to proceed with the recovery of interest payable thereon under Section 50 of the Act and penalty leviable under the provisions of the Act or the Rules. 19. From the above analysis, this Court is of the view that the Summary of the Show Cause Notice along with the attachment containing the determination of tax cannot be said to be a valid initiation of proceedings under Section 73 without issuance of a proper Show Cause Notice. The Summary of the Show Cause Notice is in addition to the issuance of a proper Show Cause Notice. Under such circumstances, this Court is of the unhesitant opinion that the impugned orders challenged in the instant batch of writ petitions are contrary to the provisions of Section 73 as well as Rule 142 (1) (a) of the Rules as the said impugned Orders were passed with issuance of a proper Show Cause Notice. (ii) Whether the determination of tax as well as the order attached to the Summary to the Show Cause Notice in GST DRC-01 and the Summary of the Order in GST DRC-07 can be said to be the Show Case Notice and Order respectively. 20. While deciding supra, this Court duly dealt with what would constitute a Show Cau ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hether Rule 26 (3) can be applicable to Chapter-XVIII when the said Sub-Rule on refers to Chapter-III. In the case of M/s Silver Oak Villas LLP (supra), the learned Division Bench of the Telangana High Court had applied Rule 26 (3) of the Rules of 2017 even to Chapter-XVIII of the Rules of 2017. In the case of A.V. Bhanoji Row (supra), the learned Division Bench of the Andhra Pradesh High Court held that the signatures cannot be dispensed with and Sections 160 and 169 cannot save an order, notice, communication which did not contain a signature. In another judgment of the learned Division Bench of Delhi High Court in the case of Railsyls Engineers Private Limited vs. Additional Commissioner of Central goods and Services Tax (Appeals-11) and Anr., reported in (2023) 112 GSTR 143, the Delhi High Court held that there was a requirement of at least putting the digital signatures on the Show Cause Notice and Order in Original. 23. A perusal of the provisions of Section 73 would show that the Show Cause Notice is required to be issued by the Proper Officer, the Statement under Section 73 (3) is to be issued by the Proper Officer as well as the Order under Section 73 (9) is required to b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at they can have a say in the hearing process. 26. It is also seen that in the reply to be submitted in Form GST DRC-06, there is an option given for personal hearing at Sl. No.7. As stated above, the petitioners in WP(C) No. 3912/2024 and WP(C) No. 3933/2024 have specifically filled up the Column as "Yes" wherein the option for personal hearing was mentioned. Inspite of that, there was no opportunity of hearing afforded to those petitioners. 27. The learned Division Bench of the Chhattisgarh High Court in the case of Mahindra & Mahindra Limited (supra) had categorically observed that when the statute contains a mandate of hearing, the same has to be granted, else it would render the provision porous. 28. This Court is of the opinion that when the statute is clear to provide an opportunity of hearing, there is a requirement of providing such opportunity. In fact a perusal of the Form GST DRC-01 enclosed to the writ petitions shows details have been given as regards the date by which the reply has to be submitted; date of personal hearing; time of personal hearing and venue of personal hearing. It is seen that in the Summary of the Show Cause Notice only the date for submission o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d in terms with Section 73 (9) are to be issued in GST DRC-01, GST DCR-02 and GST DRC-07 respectively. The issuance of the Summary of the Show Cause Notice, Summary of the Statement and Summary of the Order do not dispense with the requirement of issuance of a proper Show Cause Notice and Statement as well as passing of the Order as per the mandate of Section 73 by the Proper Officer. As initiation of a proceedings under Section 73 and passing of an order under the same provision have consequences. The Show Cause Notice, Statement as well as the Order are all required to be authenticated in the manner stipulated in Rule 26 (3) of the Rules of 2017. (D) The Impugned Orders challenged in the writ petitions are in violation of Section 75 (4) as no opportunity of hearing was given as already discussed herein above. (E) The impugned orders challenged in the instant batch of writ petitions, the details of which are given in the Appendix attached to the instant judgment are set aside and quashed. (F) This Court also cannot be unmindful of the fact that it is on account of certain technicalities and the manner in which the impugned orders were passed, this Court interfered with th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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