2025 (7) TMI 466 - HC - GST

Challenge to impugned order in Form GST DRC-07 garnishee notice and notice issued u/s 78 of GST/SGST Act 2017 for the assessment period April 2018 to March 2019 - HELD THAT - The effect of the absence of the signature on an assessment order was earlier considered by this Court in the case of A.V. Bhanoji Row Vs. The Assistant Commissioner (ST) 2023 (2) TMI 1224 - ANDHRA PRADESH HIGH COURT . A Division Bench of this Court had held that the signature on the assessment order cannot be dispensed with and that the provisions of Sections 160 169 of the Central Goods and Service Tax Act 2017 would not rectify such a defect. Following this Judgment another Division Bench of this Court in the case of M/s. SRK Enterprises Vs. Assistant Commissioner 2023 (12) TMI 156 - ANDHRA PRADESH HIGH COURT had set aside the impugned assessment order. The question of the effect of non-inclusion of DIN number on proceedings under the G.S.T. Act came to be considered by the Hon ble Supreme Court in the case of Pradeep Goyal Vs. Union of India Ors 2022 (8) TMI 216 - SUPREME COURT . The Hon ble Supreme Court after noticing the provisions of the Act and the circular issued by the Central Board of Indirect Taxes and Customs (herein referred to as C.B.I.C. ) had held that an order which does not contain a DIN number would be non-est and invalid. As the DIN is not attached to the impugned proceedings except the proceedings of 15.05.2023 it would be appropriate to set aside the order of assessment dated 02.02.2022 as well as the summary of the order of assessment dated 01.02.2022. Consequently the garnishee order notice of 15.05.2023 would also have to be set aside as the said garnishee is based on the aforesaid impugned proceedings. This Writ Petition is disposed of setting aside the impugned proceedings and remanding the matter back to the assessing authority for proper adjudication after adequate notice and opportunity being given to the petitioner.

Summary

1. ISSUES PRESENTED and CONSIDERED

The Court considered the following core legal questions:

• Whether the impugned assessment order dated 02.02.2022 and related proceedings are valid in the absence of a Document Identification Number (DIN) and signature of the assessing officer.
• The legal effect of non-inclusion of DIN on GST assessment orders and related notices under the GST/SGST Act, 2017.
• Whether the garnishee notice dated 15.05.2023 and the notice under Section 78 of the GST Act dated 20.09.2023 can be sustained when based on impugned proceedings lacking DIN and signature.
• The procedural fairness and validity of the assessment proceedings in light of statutory requirements and prior judicial precedents.

2. ISSUE-WISE DETAILED ANALYSIS

Issue 1: Validity of the assessment order in absence of DIN and signature

Relevant legal framework and precedents: The GST/SGST Act, 2017, mandates certain procedural formalities for assessment orders, including the affixation of signatures and issuance of orders with a DIN as per the circular issued by the Central Board of Indirect Taxes and Customs (CBIC). The Court relied on Sections 160 and 169 of the Central GST Act, 2017, which relate to assessment and rectification of orders. However, these provisions do not cure the absence of signature or DIN.

Precedents considered include:

• A.V. Bhanoji Row Vs. Assistant Commissioner (W.P.No.2830 of 2023) where the Division Bench held that the signature on the assessment order is mandatory and its absence invalidates the order; Sections 160 and 169 cannot rectify this defect.
• M/s SRK Enterprises Vs. Assistant Commissioner (W.P.No.29397 of 2023) where the impugned assessment order was set aside for lack of signature.
• M/s SRS Traders Vs. Assistant Commissioner (W.P.No.5238 of 2024) which reaffirmed that absence of assessing officer's signature renders the assessment order invalid.

Court's interpretation and reasoning: The Court emphasized the mandatory nature of signatures on assessment orders to ensure authenticity and accountability. It held that the absence of signature is a fundamental procedural defect that cannot be overlooked or cured by other provisions.

Key evidence and findings: The impugned assessment order dated 02.02.2022 and its summary dated 01.02.2022 were examined and found to lack any DIN or signature.

Application of law to facts: Applying the above precedents and statutory requirements, the Court concluded that the impugned assessment order is invalid and liable to be set aside due to the absence of signature and DIN.

Treatment of competing arguments: The petitioner's counsel argued that the absence of DIN and signature vitiates the order. The respondent failed to file any counter to contest this point, which the Court noted.

Conclusion: The assessment order dated 02.02.2022 and its summary dated 01.02.2022 are invalid and set aside for lack of signature and DIN.

Issue 2: Effect of non-inclusion of DIN on GST proceedings

Relevant legal framework and precedents: The Court referred to the Supreme Court's decision in Pradeep Goyal Vs. Union of India & Ors (2022), which held that an order without a DIN is non-est and invalid. The CBIC circular No.128/47/2019-GST dated 23.12.2019 mandates the inclusion of DIN in GST orders to ensure traceability and authenticity.

Further Division Bench decisions of this Court were cited:

• M/s Cluster Enterprises Vs. Deputy Assistant Commissioner (2024) holding non-mention of DIN vitiates the proceedings.
• Sai Manikanta Electrical Contractors Vs. Deputy Commissioner (2024) reiterating that absence of DIN requires setting aside the order.

Court's interpretation and reasoning: The Court underscored that DIN is a critical element for validating GST orders and proceedings. The absence of DIN undermines the legal sanctity and enforceability of such orders.

Key evidence and findings: The impugned proceedings, except the garnishee notice dated 15.05.2023, did not contain any DIN. The garnishee notice itself was based on the invalid assessment order.

Application of law to facts: The Court applied the binding precedents and the CBIC circular to hold that the absence of DIN renders the impugned proceedings invalid.

Treatment of competing arguments: No counter arguments were presented by the respondents, and the Court found no justification for dispensing with the DIN requirement.

Conclusion: The absence of DIN vitiates the impugned assessment order and related proceedings, necessitating their setting aside.

Issue 3: Validity of garnishee notice and subsequent notices based on impugned proceedings

Relevant legal framework: Garnishee notices and notices under Section 78 of the GST Act must be founded on valid assessment orders.

Court's interpretation and reasoning: Since the assessment order dated 02.02.2022 was invalidated for lack of signature and DIN, any subsequent proceedings or notices based on it, including the garnishee notice dated 15.05.2023 and the notice dated 20.09.2023, must also fail.

Application of law to facts: The garnishee notice was issued pursuant to the impugned assessment order. Therefore, it cannot be sustained independently.

Conclusion: The garnishee notice and subsequent notices are set aside as they are predicated on invalid assessment proceedings.

Issue 4: Procedural fairness and remand for fresh adjudication

Court's reasoning: The Court emphasized the necessity of providing adequate notice and opportunity to the petitioner for fresh adjudication. It ordered remand to the assessing authority for proper adjudication in accordance with law.

Application of law to facts: The petitioner is permitted to raise all grounds on facts and law in the fresh proceedings. The period between the impugned order and receipt of this judgment is excluded for limitation purposes.

Conclusion: The matter is remanded for fresh adjudication after due notice and opportunity, ensuring procedural fairness.

3. SIGNIFICANT HOLDINGS

The Court held:

"The signature, on the assessment order, cannot be dispensed with and that the provisions of Sections-160 & 169 of the Central Goods and Service Tax Act, 2017, would not rectify such a defect."

"An order, which does not contain a DIN number would be non-est and invalid."

"The absence of a DIN would vitiate the proceedings."

Core principles established include:

• Mandatory requirement of signature of the assessing officer on GST assessment orders to validate the order.
• Mandatory inclusion of Document Identification Number