Order Date – 24 January 2023

Parties: M/s Chitra Automobile Vs The State of Jharkhand and 2 others

Facts –

• The Petitioner, M/s Chitra Automobile firm is engaged in trading of Two Wheeler Bikes and its parts which are sold to the various customers.
• A Show Cause Notice under Section 73 of the JGST Act, 2017 was issued on 12.02.2022 along with FORM GST DRC-01 of even date stating that the petitioner has violated provisions of the JGST Act, 2017 related to the Tax Period March 2022 as ITC is availed after the due date.
• Since the petitioner has not presented any reply of the show cause notice dated 12.02.2022 summary of order in FORM GST DRC 07 as per Rule 142(5) of the JGST Act, 2017 was issued on 17.02.2022.

Issue –

• Whether the issuance of show cause notice is in order?

Order –

• The Hon’ble High Court held that the show cause notice was issued the same was issued in a format without striking out irrelevant particulars which is not the intent of the legislature. Thus, the foundation of the proceeding suffers from material irregularity and contrary to Section 73 (1) of the JGST Act. 
• The subsequent proceeding issued under DRC 07 dated 17.02.2022 cannot sanctify the same and liable to be set aside. DRC 07 has been issued within five days of issuance of DRC 01 is a clear picture of violation of principles of natural justice. 
• Hence the petition is allowed.