Section 74 of the CGST Act, 2017— Show Cause Notice - The petitioner sought quashing summary of the order as contained in Form-GST DRC-07 dated 11.09.2020, whereby the petitioner was directed to make payment of tax, interest and penalty. The adjudication order was dated 13th August, 2020, though in Form GST DRC-07 the date was mentioned as 11.09.2020. The court directed the respondents to submit the entire records. The order-sheets filed by respondents revealed that the adjudication order which was passed on 13th August, 2020 does not find any mention in the order-sheet. The petitioner counsel submitted that the Adjudication Order has been passed without even issuance of a SCN, and the Respondent-authority has even proceeded to pass the Adjudication Order in gross violation of the mandatory statutory provisions contained under Section 75(4) read with Section 75(5). The court observed that this case is squarely covered by the decision in the case of NKAS Services Pvt. Ltd. and it is held that the Adjudication Order is non est in the eye of law, as the same has been passed without issuance of proper show cause notice and, thus, amounts to violation of principles of natural justice. This Court is flooded with several similar writ petitions wherein the procedure prescribed under the GST Act is not being followed by the GST authorities, more particularly, the State Tax authorities, leaving no option for this Court but to entertain the writ application straightaway against the Adjudication. Further, no opportunity of personal hearing was granted to the petitioner and the purported Adjudication Order was passed on 13.08.2020 after issuance of the summary of show cause notice.

Held that:- The Hon’ble High Court quashed the summary of SCNs dated 14.03.2020, Adjudication Order Dated 13.08.2020 and summary of orders, both dated 11.09.2020. The court further directed the Commissioner of State Tax Department to issue appropriate guidelines/ circular/ notification elaborating therein the procedure which is to be adopted by the State Tax authorities regarding the manner of issuance of SCN, adjudication and recovery proceedings, so that proper procedure is followed by the State Tax authorities in conduct of the adjudication proceedings, as huge revenue of the State is involved and it would be in ultimate interest of the Respondent-State itself that the adjudication proceedings are conducted after following due procedure and process of law.