Naser Ali Mondal vs The State Of Assam And 2 Ors on 31 July, 2025

Here's a summary of the judgment:

1. Outcome
The writ petition was allowed. The impugned order dated 29.04.2024 was set aside. The Court granted liberty to the respondent authorities to initiate de novo proceedings under Section 73 of the GST Act, if considered appropriate. The period between the issuance of the Summary of the Show Cause Notice (SCN) and the date of service of the judgment copy on the Proper Officer is to be excluded from the computation of the limitation period under Section 73(10).

2. Core Issue
The core issues for determination were:
* Whether a proper SCN was issued under Section 73 of the GST Act, or if the attachment to the Summary of SCN in FORM GST DRC-01 could substitute it.
* Whether the attachments to FORM GST DRC-01 and FORM GST DRC-07 were valid without proper authentication (digital or e-signature) by the Proper Officer, as mandated by Rule 26(3) of the CGST Rules, 2017.
* Whether the impugned order was in conformity with Section 75(4) of the GST Act and the principles of natural justice, specifically regarding the opportunity of hearing.

3. Key Facts
* The petitioner, M/s Alom Enterprise, was issued a Summary of Show Cause Notice (SCN) in FORM GST DRC-01 dated 05.12.2023 for the tax period April 2018 - March 2019.
* The petitioner claimed there was no proper SCN attached, only an attachment regarding the determination of tax.
* The petitioner did not submit a reply due to the perceived lack of a proper SCN.
* Subsequently, an order was passed in FORM GST DRC-07 on 29.04.2024, stating that the assessee failed to make payment.
* The petitioner contended that neither the attachment to GST DRC-01 nor the attachment to GST DRC-07 was authenticated by the signature of a Proper Officer.
* The Summary of the SCN in GST DRC-01 did not specify a date for personal hearing, leaving the relevant column blank.

4. Arguments
* Taxpayer (Naser Ali Mondal):
* A mere "Summary of Show Cause Notice" in FORM GST DRC-01 along with a tax determination attachment does not constitute a valid SCN as required by Section 73 and Rule 142. The attachment did not require the petitioner to "show cause".
* The attachments to GST DRC-01 and GST DRC-07 were unauthenticated, lacking the digital or e-signature of the Proper Officer, violating Rule 26(3) of the CGST Rules and the Information Technology Act, 2000.
* The impugned order was passed in violation of Section 75(4) and principles of natural justice, as no opportunity of personal hearing was provided, especially when an adverse decision was contemplated. The blank column for "date of hearing" in DRC-01 indicated this omission.
* Revenue (State of Assam):
* The Summary of SCN in FORM GST DRC-01, accompanied by the determination of tax, provided all necessary details for the petitioner to submit a reply.
* Fairly conceded that there was no separate SCN apart from the tax determination document and that the attachments to DRC-01 and DRC-07 did not bear physical signatures, though it mentioned 'Sd- Proper Officer'.
* Argued that the summaries uploaded in GST DRC-01 and GST DRC-07 are duly authenticated in the portal with digital signatures, without which the portal cannot be operated.

5. Court’s Reasoning
* On SCN Requirement: The Court held that Rule 142(1)(a) mandates the serving of a summary of the SCN along with the actual notice issued under Section 73. This clearly indicates that the summary (DRC-01) is supplementary and cannot replace a proper SCN. The attachment for tax determination does not constitute a SCN as it does not require the assessee to "show cause". Section 73 itself differentiates between a SCN and a statement. Relying on precedents (Nkas Services, LC Infra Projects), the Court concluded that proceedings initiated solely based on a summary and tax determination attachment, without a proper SCN, violate Section 73 and Rule 142.
* On Authentication: The Court found that the attachments to FORM GST DRC-01 and FORM GST DRC-07 lacked proper authentication by the Proper Officer, violating Rule 26(3) which mandates digital or e-signature for notices and orders. Although Rule 26 falls under Chapter III (Registration), the Court, citing M/s Silver Oak Villas LLP and A.V. Bhanoji Row, extended its applicability to Chapter XVIII (Demand and Recovery) due to the absence of specific authentication rules in that chapter. The Court emphasized that Sections 160 and 169 (procedural lapses) cannot cure an unsigned notice or order. Thus, unauthenticated documents are invalid.
* On Opportunity of Hearing: The Court interpreted Section 75(4) to mean that an opportunity of hearing is mandatory either when a written request is made or when any adverse decision is contemplated. Since the DRC-01 left the personal hearing column as "NA," and an adverse decision (DRC-07) was passed, the failure to provide a hearing violated both the statutory mandate and principles of natural justice. Citing Mahindra & Mahindra Limited, the Court stated that a statutory mandate for hearing cannot be circumvented.

6. Statutory References
* Central Goods and Services Tax Act, 2017 (CGST Act) & Assam Goods and Services Tax Act, 2017 (SGST Act):
* Section 2(91) – Definition of Proper Officer
* Section 73(1), (2), (3), (4), (9), (10) – Determination of tax not paid or short paid etc.
* Section 75(4) – General provisions relating to determination of tax
* Section 160 – Rectification of mistakes
* Section 169 – Service of notice in certain circumstances
* Central Goods and Services Tax Rules, 2017:
* Rule 26(3) – Authentication of documents
* Rule 142(1)(a) – Notice and order for demand of amounts payable under the Act
* FORM GST DRC-01 – Summary of Show Cause Notice
* FORM GST DRC-02 – Summary of Statement
* FORM GST DRC-07 – Summary of Order
* Information Technology Act, 2000

7. Precedents Cited
* M/s Silver Oak Villas LLP vs. the Assistant Commissioner ST {WP(C) No.6671/2024} (Telangana High Court)
* A.V. Bhanoji Row vs. Assistant Commissioner (ST) & Others, (2024) 123 GSTR 432 (Andhra Pradesh High Court)
* Nkas Services Private Limited vs. State of Jharkhand & Others, (2022) 99 GSTR 145 (Jharkhand High Court)
* LC Infra Projects Pvt. Limited vs. Union of India and Others, (2020) 73 GSTR 248 (Karnataka High Court)
* Mahindra & Mahindra Limited vs. Union of India and Others, (WA No.172/2024) delivered on 10.04.2024 (Chhattisgarh High Court)
* Railsys Engineers Pvt. Ltd. V. Additional Commissioner of Central Goods and Services Tax (Appeals-II), (2023) 112 GSTR 143