Summary of SCN in Form GST DRC-01 Cannot Substitute Statutory Requirement of SCN Under CGST Act | HC

Case Details: Construction Catalysers (P.) Ltd. v. State of Assam - [2024] 168 taxmann.com 183 (Gauhati)

Judiciary and Counsel Details

• Devashis Baruah, J.
• Ms Nitu Hawelia, Ms M.L. Gope & A. Goyal, Adv. for the Petitioner.
• B. Gogoi, Standing Counsel Finance and Taxation, Dr B.N. Gogoi & Ms K. Phukan, Advs. for the Respondent.

Facts of the Case

The petitioner was issued a Summary of the Show Cause in GST DRC-01 along with an attachment of the determination of tax. It submitted a reply and requested for personal hearing but the reply was not considered and an order was passed. It filed writ petition and challenged the order by contending that proper show cause notice was not issued and opportunity of hearing was denied.

High Court Held

The Honorable High Court noted that in the instant case, the summary of Show Cause Notice in Form GST DRC-01 cannot substitute statutory requirement of show cause notice under Section 73(1) of GST Act. The statement of tax determination attached to DRC-01 would not be equivalent to show cause notice. Moreover, the authentication by proper officer is mandatory for show cause notices and orders.

Therefore, the Court held that the impugned order was liable to be quashed and the department would be at liberty to initiate de-novo proceedings. The Court also directed that period from issuance of summary show cause notices till service of judgment copy would be excluded for limitation under Section 73(10).

List of Cases Reviewed

• M/s Silver Oak Villas LLP v. the Assistant Commissioner ST [WP(C) No.6671/2024] – [Para 22] followed.
• Nkas Services Private Limited v. State of Jharkhand & Others [(2022) 99 GSTR 145] – [Para 18] followed.
• Mahindra & Mahindra Limited v. Union of India and Others [WA No.172/2024] – [Para 27] followed.
• Railsyls Engineers Private Limited v. Additional Commissioner [(2023) 112 GSTR 143] – [Para 22] followed.