The Telangana High Court has held that the Show Cause Notice (SCN) and orders under GST without proper officer’s signature cannot sustain judicial scrutiny.
The bench of Acting Chief Justice Sujoy Paul and Justice Renuka Yara has observed that various High Courts including Delhi, Andhra Pradesh, Kerala, Gauhati and this Court have taken the view that notice/order must contain the signature, and in absence thereof, they are invalid.
The petitioners/assessees have challenged the legality, validity and propriety of the show-cause notices and final orders which admittedly do not contain physical or digital signatures of the Proper Officer, although the impugned show-cause notices and final orders were placed on the portal.
The department contended that the show- cause notices and orders do not contain physical or digital signatures. However, absence of signature will not cause any dent to the show-cause notices or orders, if the scheme of the Central Goods and Services Act, 2017 (GST Act) and The Central/Telangana State Goods and Services Rules, 2017 (GST Rules) are examined.
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The department contended that statutory Form issued under Chapter-III are in Form GST REG. Chapter-XVIII of the GST Rules deals with ‘Demands and Recovery’ and Forms under this Chapter are in FORM GST DRC. Rule 142 of Chapter-XVIII of the GST Rules deals with the procedure of issuing demand notice and passing of demand order. Rule 142 (1) (a) deals with serving of summary of notice in Form GST DRC-01 and Rule 142 (5) deals with summary or order to be uploaded electronically in Form GST DRC-07. In both the Rules, it is nowhere mentioned that summary of notice or order requires digital signature on it.
The Goods and Services Tax Network (GSTN) through its advisory dated 25.09.2024 clarified that the show-cause notices and orders are generated on the common portal through the officers’ login, which is accessed using the digital signature.
These documents being computer generated upon the officers’ command do not require digital signature as they can only be issued by the officers by logging into the portal with their digital signatures. Thus, neither show-cause notices nor the orders can bear a stamp of invalidity in the absence of physical or digital signatures of the officers.
The petitioner contended that the law is well settled that show-cause notices/orders must contain the signature of the officer, who has issued them. In absence of any signature, the document is not authenticated.
The court held that since Rule and prescribed Forms mandate the requirement of signature of Proper Officer, its violation makes the notice/order vulnerable. Any contrary view taken by Court about DRC-07 having no signature without considering the above rule and prescribed Form must be held as per incuriam.
The court quashed all the notices and orders.
Case Details
Case Title: M/s. Bigleap Technologies and Solutions Pvt. Ltd. Versus State of Telangana
Case No.: Writ Petition No. 21101 Of 2024 And Batch
Date: 28-02-2025
Counsel For Petitioner: Karan Talwar
Counsel For Respondent: Swaroop Oorilla
