Facts of the Case

The petitioner, M/s. SRK Enterprises, a proprietorship represented by Mr. M. Sivarama Krishna, challenged a summary order in Form GST DRC-07 bearing No. ZD 370323015335Q dated 28 March 2023, passed under Section 73(9) of the APGST/CGST Act, 2017 by the Assistant Commissioner (ST), Bheemili Circle, Visakhapatnam-I Division, for the tax period April 2020 to March 2021. The demand arose after verification of the petitioner's bank statement revealed receipt of Rs. 93,62,630 from the Andhra Pradesh Mineral Development Corporation Limited that was allegedly not reflected in the petitioner's GSTR-3B return, The petitioner filed Writ Petition No. 29397 of 2023 before the High Court of Andhra Pradesh at Amaravati, seeking to set aside the DRC-07 order and remand for fresh adjudication after due observance of natural justice. With the consent of both parties' counsel, the matter was heard and decided finally at the admission stage itself by a Division Bench of Justice Ravi Nath Tilhari and Justice A.V. Ravindra Babu on 10 November 2023.

Issues Involved

  1. Whether an unsigned demand order in Form GST DRC-07 is valid and enforceable in law.
  2. Whether Section 160 of the CGST Act, 2017, which saves proceedings from invalidity for mistakes, defects or omissions, can cure the absence of a signature on the order.
  3. Whether Section 169 of the CGST Act, 2017, dealing with modes of service of notice, can be invoked to dispense with the requirement of signing an order.
  4. Whether the order travelled beyond the grounds mentioned in the show cause notice, resulting in a violation of natural justice.

Petitioner's Arguments

  • The impugned order dated 28 March 2023 was unsigned and was therefore no order in the eyes of law and could not be enforced.
  • Reliance was placed on a co-ordinate Bench decision in A.V. Bhanoji Row v. Assistant Commissioner (ST), which held that signatures cannot be dispensed with under Sections 160 and 169 of the CGST Act.
  • The order relied on a ground (unreflected bank receipts) not specifically mentioned in the show cause notice dated 31 January 2023, denying the petitioner opportunity to reply, in violation of natural justice.

Respondent's Arguments

  • On instructions received pursuant to the Court's oral query, the Government Pleader for Commercial Tax admitted that the impugned order had not been signed as on the date of hearing.
  • Section 160 of the CGST Act, it was submitted, saves proceedings from invalidity for mere mistake, defect or omission, if in substance and effect in conformity with the Act.
  • It was contended that the order had merely been uploaded on the common portal, and such uploading by the competent authority should be treated as sufficient compliance.

Court Order/Findings

  • The Court held that Section 160 of the CGST Act, 2017 is not attracted to an unsigned order; the mistake, defect or omission contemplated therein does not extend to the omission to sign the order, which is no order in the eyes of law.
  • Section 169, which deals with modes of service including making an order available on the common portal, cannot be used as a guise to dispense with the requirement of signatures on the order itself.
  • The Court declined to examine the second ground (regarding the alleged new basis for the demand) on merits, leaving it open to the competent authority to consider it afresh and, if necessary, issue a fresh notice.
  • The writ petition was allowed in part; the impugned unsigned order was set aside with a direction to the competent authority to pass a fresh order in accordance with law within six weeks, considering the petitioner's existing and any additional reply.

Important Clarification

An unsigned demand order under the GST Act is non-est in law. Sections 160 and 169 of the CGST Act, 2017 — which save proceedings from invalidity for procedural mistakes and prescribe modes of service — cannot be invoked to cure the fundamental defect of an unsigned order, since signing goes to the very root of the order's validity, not merely to its service or mode of communication.

Sections Involved

  • Section 73(9) of the Andhra Pradesh Goods and Services Tax/Central Goods and Services Tax Act, 2017 — determination of tax not paid or short paid.
  • Section 160 of the Central Goods and Services Tax Act, 2017 — proceedings not invalid for certain mistakes or defects.
  • Section 169 of the Central Goods and Services Tax Act, 2017 — service of notice in certain circumstances.

Decision – In Favour of

The decision favours the Assessee. The unsigned DRC-07 order was set aside on the specific ground of the missing signature, with the matter remanded for fresh adjudication within six weeks, while the merits of the underlying tax demand remain open for consideration by the competent authority.

Related Case Laws

No directly on-point case notes are currently published on this site.

Case Details

  • Court: High Court of Andhra Pradesh at Amaravati
  • Case No.: WRIT PETITION NO: 29397 OF 2023
  • CNR: Not available
  • Coram: Justice Ravi Nath Tilhari and Justice A.V. Ravindra Babu
  • Decision Date: 10 November 2023
  • Disposal Nature: Writ allowed in part; unsigned DRC-07 order set aside for fresh adjudication

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