Facts of the Case

The petitioner, Phanidhar Borsaikia of Dhemaji, Assam, challenged proceedings initiated by the Assistant Commissioner of State Tax, Dhemaji-2, comprising a summary of show cause notice dated 29.11.2024 and a summary of order dated 27.02.2025, both issued in the prescribed summary forms under the CGST Act without any proper show cause notice under Section 73(1) or a proper order under Section 73(9) ever having been issued. The petitioner also complained of denial of an opportunity of hearing despite specifically seeking one. The Department, in its affidavit before the Gauhati High Court, admitted that only a summary of the show cause notice existed and that no notice under Section 73(1) had in fact been issued.

Issues Involved

  1. Whether the Summary of Show Cause Notice in FORM GST DRC-01 can substitute for an actual show cause notice required to be issued under Section 73(1) of the CGST/State GST Act.
  2. Whether an order passed without a proper Section 73(1) notice and without an opportunity of hearing under Section 75(4) is sustainable.
  3. Whether such proceedings must be authenticated and issued specifically by the 'Proper Officer' as defined under Section 2(91).

Petitioner's Arguments

  • No show cause notice in terms of Section 73(1) was ever issued to the petitioner; only a Summary of Show Cause Notice in FORM GST DRC-01 was issued, which cannot substitute for the statutorily mandated notice.
  • The petitioner had sought an opportunity of hearing, which was denied, resulting in the summary of order being passed in violation of Section 75(4) of the Act.
  • The issue was directly covered by the Gauhati High Court's own detailed ruling in Construction Catalysers Pvt. Ltd. v. State of Assam, which laid down comprehensive conclusions on this exact defect.

Respondent's Arguments

  • The respondents, through their affidavit, admitted that a summary of show cause notice existed but that no show cause notice in terms of Section 73(1) of the CGST Act had in fact been issued to the petitioner.

Court Order / Findings

  • Given the Department's own admission and the parties' agreement that the issue mirrored Construction Catalysers Pvt. Ltd., the Court applied paragraph 29 of that judgment in full to the present case.
  • The Summary of Show Cause Notice in GST DRC-01 is not a substitute for the actual Show Cause Notice mandated by Section 73(1), nor is the Summary of the Statement of tax determination under GST DRC-02 a substitute for the Statement under Section 73(3); both the Notice and the subsequent Order under Section 73(9) must be issued by the 'Proper Officer' as defined under Section 2(91) and duly authenticated under Rule 26(3), failing which the initiation of proceedings and any resulting order are bad in law.
  • The summary of show cause notice dated 29.11.2024 and the summary of order dated 27.02.2025 were both set aside, with liberty granted to the authorities to initiate de novo proceedings under Section 73 if deemed fit, and the period from issuance of the summary notice till service of the certified copy of the judgment was excluded for computing limitation under Section 73(10).

Important Clarification

  • A 'Summary of Show Cause Notice' issued in FORM GST DRC-01 is a mere administrative summary and cannot substitute for the mandatory Show Cause Notice required under Section 73(1) to validly initiate proceedings.
  • Similarly, the Summary of the Statement of tax determination (DRC-02) cannot substitute the Statement mandated under Section 73(3), and the Summary of Order (DRC-07) cannot substitute the actual order under Section 73(9); all three, and the notice/statement/order they summarise, must be issued by the jurisdictional 'Proper Officer' and duly authenticated.
  • Where such orders are set aside on this technical ground, the Department retains liberty to initiate fresh proceedings, with the intervening period excluded from the limitation computation under Section 73(10), protecting revenue while enforcing procedural compliance.

Sections Involved

  • Section 73(1), (3) and (9), CGST Act, 2017 – require issuance of a proper Show Cause Notice, Statement of tax determination, and Order respectively, none of which can be substituted by their summary forms.
  • Section 2(91), CGST Act, 2017 – defines 'Proper Officer' who alone can issue such notices, statements and orders.
  • Section 75(4), CGST Act, 2017 – mandates opportunity of hearing where sought or an adverse order is contemplated.
  • Rule 26(3), CGST Rules, 2017 – requires authentication of notices, statements and orders by digital or manual signature.

Decision – In Favour of

The decision is in favour of the assessee. The impugned summary notice and summary order were both quashed for failure to issue a proper Section 73(1) notice, with liberty to the Department to initiate fresh proceedings within a protected limitation period.

Case Details

Gauhati High Court (Assam, Nagaland, Mizoram and Arunachal Pradesh); WP(C)/1749/2025 (Case No. 2025:GAU-AS:8498); Phanidhar Borsaikia vs The State of Assam and Two Others; Coram: Justice Arun Dev Choudhury; Decided on 24.06.2025.

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