23.03.2023: Uploading Show Cause Notice On The GSTN Portal Is Mandatory In Terms Of Rule 142 (1) Before Issuing Assessment Orders – Punjab and Haryana High Court

The Hon’ble High Court of Punjab and Haryana vide its order dated 30.01.2023 in the matter of M/s New Hanumat Marbles, M/s Shri Mahesh Marble Vs. State of Punjab and Others in CWP – 10560 of 2021 and CWP – 10568 of 2021, set aside the impugned assessment orders for the reason that the show cause notice was not uploaded on the GSTN Portal/Revenue Website in terms of Rule 142(1) of the CGST rules, before passing the aforesaid assessments orders under Section 74(5) of CGST Act/PGST Act, 2017.

The Petitioner filed the writ petitions before the Hon’ble High Court challenging and seeking quashing of order in Form GST DRC- 07 dated 12.03.2021 and detailed order dated 10.03.2021  passed under Section 74(5) of the Central GST/ Punjab GST Act, 2017.

Petitioner’s Submissions: –

  • Referring to the impugned assessment orders, it was submitted on the behalf of the petitioner that a search was conducted in the premise of the petitioner on 03.01.2018 and some documents were seized from his office. Thereafter, a notice was issued to the petitioner, in pursuance of which the Advocate of the petitioner duly appeared and filed the written submissions.  The copy of the panchnama was also provided on a request made by the Advocate.  Further, from the perusal of the order dated 10.03.2021, shows that on 08.01.2021, this case was allotted to some other officer and that officer issued summon No. 1554 dated 19.02.2021 under Section 70 of the Punjab/Central GST Act, 2017.
  • It was submitted that before passing final order on assessment, in terms of Rule 142 (1) of the CGST rules, it is mandatory to upload GST DRC – 01 electronically on the revenue website. To support its contention, reliance was placed on the judgment of Madhya Pradesh High Court in M/s Shri Shyam Baba Edible Oils Vs. The Chief Commissioner and another dated 19.11.2020, wherein ‘referring to Rule 142(1) of the CGST rules, it was observed that the only mode prescribed for communicating the show cause notice/order is by way of uploading the same on the revenue website.

Respondents’ Submissions: –

  • Responding the contentions raised on the behalf of the petitioner, it was submitted that a summon dated 19.02.2021 was issued to the petitioner before initiating proceedings of the passing assessment order under Section 74(5) of the CGST/PGST Act, 2017. On 05.03.2021, another notice was issued under Section 70, 50 and 74 of the CGST/PGST Act, 2017 read with Section 20 of the IGST Act, 2017 for appearing on 10.03.2021.  However, the petitioner did not appear and thereafter, the case was decided on merits.
  • It was also submitted that after the documents were seized, several notices were issued to the petitioner to appear along with account books for verification, but he did not appear. Therefore, the Authority had no option but to pass order since the petitioner, after affording several opportunities, did not appear and the case was disposed of on the basis of material available on the record and keeping in view the interest of the revenue.

Held: –

The Hon’ble Court after considering the submissions made, facts of the case & the law applicable, found that in the present case, it has been nowhere stated by the respondents that they had uploaded the notice on the website of the revenue as per Rule 142(1) of the CGST Act, 2017 before passing final orders dated 12.03.2021 and 10.03.2021. Hence the impugned orders are set aside.

The Hon’ble Court with the above observations & findings, allowed the writ petition by setting aside the impugned orders dated 12.03.2021 and 10.03.2021.  The matter was remanded back to the Assessing Officer to pass fresh orders after issuing notice as prescribed under Rule 142(1) of the CGST Act and afford opportunity of hearing to the petitioner(s) in accordance with law.

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