Phanidhar Borsaikia Vs State of Assam And 2 Ors (Gauhati High Court)
Gauhati High Court has set aside a Goods and Services Tax (GST) demand against petitioner Phanidhar Borsaikia, ruling that the tax authorities failed to issue a proper show cause notice as mandated by the Central Goods and Services Tax (CGST) Act, 2017. The judgment, delivered recently, underscores the critical importance of strict adherence to procedural requirements in tax assessments, particularly the issuance of a valid show cause notice under Section 73(1) of the CGST Act.
The petitioner, Mr. Phanidhar Borsaikia, brought the matter before the High Court, asserting that the Assistant Commissioner of State Tax, Dhemaji-2, Dhemaji Tezpur Zone, had issued merely a “summary of show cause notice” (in GST DRC-01) and a “summary of order” (in GST DRC-07) without first issuing a substantive show cause notice under Section 73(1) and a final order under Section 73(9) of the CGST Act. Additionally, Mr. Borsaikia contended that he was denied an opportunity for a hearing before the summary order was passed.
During the court proceedings, the respondents, represented by the Finance and Taxation Department, Assam, filed an affidavit. In this affidavit, they conceded that while a summary of show cause notice was indeed issued, a formal show cause notice in terms of Section 73(1) of the CGST Act, 2017, was not issued to the petitioner. This admission by the tax authorities proved to be a pivotal point in the case.
