Summons Under CGST Section 70: Can CFO Substitute for MD? Court Seeks Affidavits on Panchanama Copies Request

The HC addressed a challenge to CGST authorities' power to issue summons under section 70 and the competency of a Managing Director to respond. The court granted respondents four weeks to file an affidavit in reply, with provision for rejoinder within two weeks thereafter. Notably, no stay was granted on the summons or other proceedings during the petition's pendency. The court directed respondents to address in their affidavit the petitioner's request for copies of the Panchanama. The Group Chief Finance Officer was proposed as an alternative witness to cooperate with authorities instead of the Managing Director.

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Issues:
1. Challenge to the power of the authority under section 70 of the Central Goods and Services Tax Act, 2017 to issue summons.
2. Competency of the Managing Director of the petitioner to appear in response to the summons.
3. Granting time for filing affidavit in reply and subsequent legal procedures.
4. Clarification on the stay of summons or proceedings during the pendency of the petition.
5. Direction to respondents to address the prayer clause regarding the supply of copies of the Panchanama.

Issue 1 - Challenge to Authority's Power to Issue Summons:
The petitioner challenges the authority's power under section 70 of the Central Goods and Services Tax Act, 2017 to issue summons, citing the blocking of utilized ITC by the State GST authority. The petitioner contests the validity of the summons issued on the grounds of the previous actions taken by the State GST authority.

Issue 2 - Competency of Managing Director to Respond to Summons:
The petitioner argues that the Managing Director is not a competent witness to appear in response to the summons issued by the authority. Instead, the petitioner suggests that the Group Chief Finance Officer can represent and cooperate with the authority in this matter, highlighting the Managing Director's lack of competence.

Issue 3 - Filing of Affidavit and Legal Procedures:
The court grants the respondents four weeks to file an affidavit in reply, to be served simultaneously to the petitioner's advocate. A provision for a rejoinder, if necessary, within two weeks thereafter is also established, emphasizing the procedural requirements for the legal process.

Issue 4 - Stay of Summons or Proceedings:
The court clarifies that no stay has been granted on the summons or any other proceedings that may be initiated by the respondents against the petitioner during the pendency of the petition until the next hearing date, setting the tone for the continuation of legal actions.

Issue 5 - Addressing Prayer Clause Regarding Panchanama Copies:
The respondents are directed to address the prayer clause concerning the supply of copies of the Panchanama in the affidavit in reply to be filed, ensuring that all aspects of the petitioner's requests are considered and responded to in the legal proceedings.

This detailed analysis of the judgment from the Bombay High Court encompasses the various issues raised by the parties involved, the court's directions, and the legal procedures to be followed in the ongoing case.

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