Order not valid if notice in Part A of FORM GST DRC-01A was not issued

Skyline Automation Industries Vs State of U.P. and another (Allahabad High Court)

Demand order not sustainable without issuance of SCN and fair opportunity to respond

The Hon’ble Allahabad High Court in Skyline Automation Industries v. State of Uttar Pradesh [Writ Tax No. – 1512 of 2022 dated January 2, 2023] quashed the demand order passed in Form DRC-07, by the Revenue Department, on the grounds that a notice in Part A of FORM GST DRC-01A under Rule 142(1A) of Central Goods and Services Rules, 2017 (“the CGST Rules”) was not issued. Held that, subsequent reminder would not have cured inherent defect in proceedings initiated against the assessee as the initiation of proceedings itself are bad, thus, the order passed consequent thereto will also fall.

Facts:

This writ petition has been filed by the Skyline Automation Industries (“the Petitioner”) challenging the order dated November 10, 2022 (“the Impugned Order”) passed by the Revenue Department (“the Respondent”) under Section 74(9) of the Central Goods and Services Tax Act, 2017 (“the CGST Act”). The Petitioner stated that in terms of the provisions of Rule 142(1A) of the CGST Rules, before passing any order under Section 74 of the CGST Act, a Show Cause Notice (“SCN”) in Part A of FORM GST DRC-01A is required to be issued, which was not issued to the Petitioner therefore, fair opportunity to respond was not granted to the Petitioner.

Please become a Premium member. If you are already a Premium member, login here to access the full content.