Order Date: 11 July 2022

Facts:

• The Petitioner Pawan Kumar singh and others, is engaged in civil construction/ sale of electric goods, etc.
• Petitioners has sought quashing of the show-cause notice issued under section 73 of JGST Act, 2017. Petitioners has also laid challenge to the Summary of show-cause notice issued in Form GST DRC-01 and also challenged the Summary of the Order issued in Form GST DRC-07. The show-cause notices and Summary of the show-cause notices in Form GST DRC-01 mentions the charge i.e. difference between GSTR-3B and 2A.
• The Petitioner submitted that there is no specific denial of the plea that no penalty of 100% of the tax dues can be levied in a proceeding under section 73(1) in terms of section 73(9) of the Act, 2017.

Issue:

• Whether the show cause notice u/s 73 of JGST and summary of the show cause notices in form GST DRC-01 and summary of order in form GST DRC-07 was issued in compliance with provisions of the GST Act?

Order:

• The Court observed that the notices under section 73(1) of the CGST Act in the respective writ petitions are in the standard format and neither any particulars have been struck off, nor specific contravention have been indicated to enable the petitioners to furnish a proper reply to defend themselves. The show-cause notices can therefore, be termed as vague.
• The court further observe that the Levy of penalty of 100% of tax dues reflected in the Summary of the Orders contained in Form GST DRC-07 are also in the teeth of the provisions of Section 73(9) of the CGST Act, wherein while passing an adjudication order, the Proper Officer can levy penalty up to 10% of tax dues only. The infirmity clearly shows non-application of mind on the part of the Deputy Commissioner - Proceedings also suffer from violation of principles of natural justice and the procedure prescribed under section 73 of the CGST Act and are in teeth of the judgment rendered by this Court in the case M/s NKAS SERVICES PRIVATE LIMITED.
• Accordingly, the impugned show-cause notices and Summary of the Show Cause Notices and Summary of Orders contained in Form GST DRC-07 are quashed.