Facts of the Case:

In this case, the petitioner was subjected to scrutiny proceedings initiated through Form ASMT-10 dated 29.11.2022. The petitioner filed its reply in Form ASMT-11 on 25.04.2023. Thereafter, a show cause notice dated 23.09.2023 under Section 73 of the CGST Act, accompanied by Form GST DRC-01, was issued, followed by an Order-in-Original dated 19.12.2023 and Form GST DRC-07. The documents were uploaded on the GST portal but, according to the petitioner, none of them carried either a physical or digital signature. Subsequently, a recovery notice in Form DRC-13 under Section 79 dated 27.03.2024 was issued to the petitioner’s banker, resulting in freezing of its bank account. The petitioner thereafter came to know of a demand of Rs. 11,76,97,600 reflected on the GST portal. It challenged the SCN, adjudication order and consequential recovery proceedings before the Rajasthan High Court, contending that unsigned statutory documents were non est and could not create any enforceable tax liability.

The Revenue contended that the documents were validly generated and uploaded through the departmental BOWEB/GSTN system. According to the Revenue, an officer could upload a document only after logging into the portal using a digital signature, and generation of an ARN/reference number itself demonstrated that the requisite digital authentication had taken place. It was therefore argued that the absence of a visible signature on the downloaded/printed document was merely a technical issue and did not invalidate the proceedings.

The Revenue also raised the objection of availability of the statutory appellate remedy under Section 107.

Issue:

Whether a show cause notice and an adjudication order issued under the GST law, which bear neither a physical signature nor a digital/e-signature, can be treated as valid merely because they were generated and uploaded on the GST portal after the proper officer logged into the portal using digital credentials; and whether consequential recovery and bank attachment can survive such defect?

Held that:

The Rajasthan High Court allowed the writ petition and quashed the proceedings, holding that Rule 26(3) of the CGST Rules, 2017 mandates authentication of notices, certificates and orders by a digital signature certificate, e-signature or such other mode of verification as may be notified by the Board. The Court emphasised that the use of the word “shall” in Rule 26(3) makes the requirement mandatory. Electronic generation or uploading of a document satisfies the requirement of electronic issuance, but does not by itself satisfy the separate requirement of authentication.

The Court rejected the Revenue’s contention that logging into the portal through digital credentials amounts to a “deemed digital signature” of the document. It drew a clear distinction between authentication of the officer’s access to the portal and authentication of the contents of the statutory document. In the Court’s view, “a login authenticates access; a signature authenticates content.” Rule 26(3) contains no concept of deemed digital signature. Treating portal login as equivalent to signing the document would leave the contents of the SCN or order unattributable to any identified officer and would dilute accountability and transparency.

The Court also distinguished the Gujarat High Court’s decision in M/s Vishwa Enterprise v. State of Gujarat. In that case, the documents were in fact digitally signed and the grievance related only to the manner in which the digital signature was displayed by the software. The present case was materially different because there was no signature at all, either physical or digital. The Court therefore held that a defect in displaying an existing digital signature may be curable, whereas complete absence of authentication is fundamentally different and cannot be treated as a mere technical defect.

Relying also on the principle emerging from the authorities cited before it, including Kilasho Devi Burman, Pr. CIT v. Prahlad Singh and CIT v. Aparna Agency Pvt. Ltd., the Court held that an unsigned quasi-judicial document is effectively an anonymous document, and anonymity cannot coexist with the exercise of quasi-judicial authority. The signature is not an empty procedural formality; it identifies the authority responsible for the decision and provides authentication and accountability.

The Court further followed the reasoning of its coordinate Bench in M/s Mayur Timber v. State of Rajasthan, where it had held that issuance and authentication under Rule 26(3) are distinct and cumulative requirements. Mere electronic generation of a document on the portal fulfils only the requirement of issuance; it does not fulfil the mandatory authentication requirement. Consequently, an SCN and adjudication order which are neither digitally nor physically signed are “no notice and no order in the eyes of law”, and the defect goes to the root of the proceedings.

The Court consequently held that the defect was jurisdictional and not a curable irregularity under Section 160 of the CGST Act. Since the SCN itself was non est, the adjudication order founded upon it was also non est. The Court further rejected the Revenue’s objection regarding the alternative remedy under Section 107, observing that a statutory appeal presupposes the existence of a valid adjudication order. Where the very existence of the order is in question and the Court finds that no valid order exists in law, the alternative-remedy principle does not prevent exercise of writ jurisdiction.

Accordingly, the SCN dated 23.09.2023 and Order-in-Original dated 19.12.2023 were quashed and set aside. The consequential Section 79 recovery notice in Form DRC-13 dated 27.03.2024 and the attachment of the petitioner’s bank account were also set aside. However, the Court preserved liberty for the competent authority to initiate fresh proceedings in accordance with law, provided that any fresh notice or order is duly authenticated by a physical or digital signature as required under Rule 26(3) and is properly served upon the petitioner.

Case Name: Star Raison Landmarks versus Chief Commissioner State Tax Commercial Taxes Department dated 15.09.2026

Citation No. 2026 Taxo.online 2867