2024 (1) TMI 763 - HC - GST

GST Tax Authority Ordered to Reissue Notice After Procedural Errors Invalidate Original Order Under Section 74(9)

Shree Vasu Steels Pvt. Ltd. Versus Commissioner of The SGST, Deputy Commissioner II State Tax Department

HC quashed the order under Section 74(9) of Uttarakhand GST Act due to procedural irregularities. The tax authority failed to provide proper notice and ... Violation of principles of natural justice - petitioner was denied opportunity to file reply in respect of notice under Section 74 given in Form GST DRC-01 - HELD THAT:- In the present case, the notice under Section 74(1) of GST Act and the intimation in form GST DRC- 01A was uploaded together on 21.03.2023. In form GST DRC-01A, it was mentioned that petitioner may file his submission by 31.03.2023, while by the notice issued under Section 74(1), petitioner was required to file his reply by 31.03.2023 also. Thus, petitioner a valuable right of filing his submission in response to the notice issued under Section 74(1). Thus a limited interference is called for in the matter. The impugned order dated 10.11.2023 is quashed. The writ petitions are allowed and the matter is remanded back to the Competent Authority. Issues involved:The issues involved in this case are a challenge to the order dated 10.11.2023 passed by the Deputy Commissioner, State Tax under Section 74(9) of the Uttarakhand GST/CGST Act, 2017. The petitioner alleges denial of the opportunity to file a reply in response to the notice under Section 74, claiming that the intimation in Form GST DRC-01A was uploaded simultaneously with the show cause notice, which is deemed impermissible.Judgment Details:Challenge to Order under Section 74(9):The petitioner challenged the order dated 10.11.2023 issued by the Deputy Commissioner, State Tax under Section 74(9) of the Uttarakhand GST/CGST Act, 2017. It was contended that the petitioner was not given the opportunity to respond to the notice under Section 74, as the intimation in Form GST DRC-01A was uploaded concurrently with the show cause notice. This was argued to be impermissible as per the relevant rules.Violation of GST Rules:The petitioner argued that as per Rule 142 of the Central Goods and Service Tax Rules, 2017, before issuing a notice under Section 74, the person chargeable with tax should receive an intimation in Form GST DRC-01A followed by Form GST DRC-01 to enable a response. However, in this case, both the notice under Section 74(1) and the intimation in Form GST DRC-01A were uploaded simultaneously, depriving the petitioner of the opportunity to file a submission in response.Remand and Fresh Proceedings:The Court acknowledged the petitioner's right to file a submission in response to the intimation in Form GST DRC-01A and found that the petitioner was not given a reasonable opportunity to present their case. Consequently, the impugned order dated 10.11.2023 was quashed, and the matter was remanded back to the Competent Authority. The Competent Authority was directed to consider the petitioner's reply, if filed within two weeks, and was given the liberty to issue a fresh show cause notice under Section 74(1) if necessary.Compliance and Future Actions:The Court ordered that if the petitioner fails to submit a reply to the intimation in Form GST DRC-01A within the stipulated time, the GST authorities are at liberty to proceed in the matter as per the law. A certified copy of the order was directed to be issued within 24 hours for compliance.This judgment highlights the importance of adhering to procedural requirements and providing the affected party with a fair opportunity to respond in matters concerning tax liabilities under the GST laws.