Section 73/74 of the CGST Act — Show Cause Notice –- The petitioners challenged the Summary of the Order dated 26.02.2020 issued in Form GST DRC-07 and sought quashing of the demand notices issued in Form GST DRC-01 dated 28.01.2020. The counsel for the petitioner submitted that no SCN under Section 73 of 74 has been issued before passing the adjudication order in spite of clear mention in Form GST DRC-01 dated 28.01.2020. Interest under Section 50(1) of the Act cannot be demanded for delay in filing monthly return in Form GSTR-3B, but for the delay in payment of the taxes. Section 50 deals with the liability to pay interest on “unpaid” tax when a person “fails to pay” tax. Substitution of GSTR-3B for filing return with effect from 01.07.2017 does not make levy of interest retrospective.  The court observed that no notice under Section 73(1) of the Act, 2017 was issued, before Summary of the Order was issued in GST DRC-07 on 26.02.2020. The Respondents have failed to follow the procedure prescribed in law before issuing Summary of the Order in Form GST DRC-07.  As such, writ petition succeeds only on the point of failure to follow the principles of natural justice and the procedure prescribed in law. They consciously refrain from making any comments on the merits of this contention raised by the petitioner at this stage.

Held that:- The Hon’ble High Court quashed the impugned summary of the Order contained in Form GST DRC-07 dated 26.02.2020. Respondents are at liberty to issue proper SCN in terms of Section 73(1) with opportunity to the petitioner to file response thereto before passing any adjudication order.