Section 74 of the CGST Act, 2017— Issuance of Proper Show Cause Notice –- The petitioner submitted that no proper show-cause notice was issued and issuance of SCN U/s 74(1) of the Act is mandatory and imperative in character. Form DRC 01 is not a substitute of SCN u/s 74(1). It was alleged that the petitioner had availed ITC fraudulently. The court observed that the foundation of the proceeding in both the cases suffers from material irregularity and hence not sustainable being contrary to Section 74(1) of the Act. The respondent State cannot take benefit of the said action as summary of show cause notice cannot be considered as a show cause notice as mandated under Section 74(1) of the Act. A bonafide mistake or consent by the assesse cannot confer any jurisdiction upon the proper officer. The jurisdiction must flow from the statute itself. The rules of estoppels is rule of equity which has no role in matters of taxation. The impugned SCNs does not fulfill the ingredients of a proper show- cause notice and thus amounts to violation of principles of natural justice.

Held that:- The Hon’ble High Court set aside the summary of SCNs dated 14.09.2018 issued in Form GST DRC-01 and the orders dated 25.02.2019 issued under section 74(9) and also the final orders dated 3.3.2021 passed after rectification.