DRC-01 Summary Not a Substitute for Statutory SCN

Case Details: Arnab Kumar vs. State of Assam - [2026] 185 taxmann.com 107 (Gauhati)

Judiciary and Counsel Details

Soumitra Saikia, J.
A K Gupta, Ms M Dey, Ms B Sarma & R S Mishra, Advs. for the Petitioner.

Facts of the Case

The petitioner challenged demand proceedings on the ground that no proper show cause notice (SCN) was served, and only a summary in GST DRC-01 with an attachment showing tax determination was issued. It was submitted that such summary could not substitute a statutory notice under Section 73 of the CGST Act. The petitioner further contended that attachments to GST DRC-01 and GST DRC-07 lacked the digital signature or e-authentication as required, rendering them invalid. It was also submitted that despite requesting a personal hearing in GST DRC-06, no such opportunity was granted before passing the adverse order in GST DRC-07. The matter was accordingly placed before the High Court.

High Court Held

The High Court held that the issuance of a proper SCN specifying the reasons is a mandatory prerequisite for the initiation of proceedings under Section 73 of the CGST Act, and a summary in the GST DRC-01 cannot substitute for this statutory requirement. It held that the statutory scheme clearly distinguishes between a SCN and its summary, and both are required to be issued independently in accordance with Rule 142 of the CGST Rules. The Court also held that the requirement of granting a personal hearing under Section 75 is mandatory where requested or where adverse action is contemplated, and denial of such an opportunity vitiates the proceedings. Accordingly, the Court set aside the impugned order and granted liberty to the jurisdictional officer under CGST to initiate proceedings afresh in accordance with due process of law.