M/S. Star Enterprises vs. The State Tax Officer

Perused the material available on record.

The instant Writ Petition has been filed by the petitioner under Articl e 226 of the Constitution of India seeking the following relief; "to issue a writ, order or direction more particularly one in the nature of a writ of mandamus; (r) declaring impugned Order vide Ref No.ZD361223O5O 630U, dated 27 /72/2023 passed by the 1"t Respondent under the provisions of CGST/TGST Act, 2Ol7 as being void, arbitrary, illegal without juri iction, violative of the principles of natural justice, apart from being violative of Articles 1a' 19(1)(g) and 265 of the Constitution of India and to T r 2 PSK,J & NTR,,I W.P,No.7257 of 2024 consequently set aside the same and pass such further or other orders as this Honourable Court may deem ht and proper in the circumstances of tl-e case. (ii) declaring that the Notillcarion No.O9 /2O23-C.T, dated 311O3/2023, issued by Respondent No.S through Respondent No.6 and corresponding G.O.Ms.No. 1lg, dated 25/0812023, issued by Respondent No.4 which extended the time limit for passing the orders are without authority of law and ultra vires to the section 73(10) of the GST Act, 2O7Z arLd Section 168A, of GST Act, 2Ol7 and violative of articles 14, t9(1)(g), 2t and 265 of the Constitution of India'

The primar5r contention of the learned counsel for the petitioner assailing the show cause notice as also the impugned order was that the show cause notice as :r_lso the assessment order have not been signed by the lst respondent either digitally or physically as is otherwise required under Rule 26 of ttre Central Goods and Serrices Taxes Rules (for short "CGST Rules,,).

The learned counsel for the Department submits that he has not received any satisfactory instructions from the Department as to why the show cause notice as also the order of assessment have not been signed by the 1"t respondent while issuing the same either digitally or physically.

It is at this juncture relevant to take note of the recent decision of the High Court for the State of Andhra Pradesh in W.P.No.29397 of 2023 and stood decided on l}.ll.2o23, wherein the Hon'ble Division Bench of the Andhra Pradesh High Court had under similar circumstarces in paragraph Nos.7 to 12 held as under: u7. On consideration of the submbsions aduanced and the legat prouisions, u)e are of the uietu that Section 16O of CGST Act 2O17 is not attracted. An unsigned order utnnot be couered under ---ang mistake, dekct or omission thereinl as used in Section 160. The said expression refers to ang mistake, dekct or omission in an order with respect to assessment, re-assessment; adjudication etc and u;hich shall not be inualid or deemed to be inualid bg suclt reason, if in substance ond effect the assessmenl, re-assessment etc is in conformity tuith the reqtirements of the Act or ang exbting lau.t- These uould not couer omission to sign the order. Unsigned order b no order in the eAes of latt,. Merely uploading of the unsigned order, may be by the Authoity conTpetent to pass the order, would, in our uieu, not cure the defect uLhich goes to the uery root of the matter i.e. uolidity of the order.

We are oJ the further uieu.t tlnt Section 169 of CGST Act 2017 i.s also not attracted. Here, the qtestion is of not signing the order and not of its serwice or mode of seruice. 9. ln the ca-se of A. V. Bhonoji Row us. Assrlstanl Commissioner (ST) in W.P.No.283O of 2023 decided on 14.02.2023, upon u.tlrich reliance has been placed bg learned counsel for the petitioner (Ex.P6), a Co- oidinate Bench of this Court has held that the signatures cannot be dispensed u.tith and the prouisions of Seclions 160 and 169 of CGST Act would not come to the rescue. a ,l rc 4 PSK,J & NTR,,I W.P.No.7251 o.f 2024

Paragraph 6 of A. V. reproduced as undet- - Bhanoji Rout (supra) is 6. A reading of Section 160 of the Act makes it uery much clear and candid that the safeguards contained. therein cannot be made applicable for the contingencA in the present case. Section 169 of the Act, which deaLs with the se:ice of notice, enables the department to make auailable any d.ecision, order, Summons, Notice or other communictttion in the common portal. In the gtise of tlrc sanne, the signatures cannot be dispensed with. In the considered opinion of thb court, the aforesaid prouisions of laut uoutd not come to the resale of the respondent herein, for justifuing the impugned crction.

The u.tit petition deserues to be allou..ted on the first ground itsel"f.

Consequentlg, rue are not enteing into the meits of the second ground, leauing it open to the concented authoity to con-sider, if the ground as in the impugned order, is different than the one contained in the show cause notice, and. if it is so, it sha be open for the Autlnrity to issze fresh notice, if it is proposed to proceed on such ground. Howeuer, at this stage, learned counsel for the petitioner submits that the petitioner has submitted replg to the shotu cause notice dated 31.01.2023 and he shatt also file addittonal reptg, with respect to the atteqed ieu, ground os in the impugned order of his outnl Lt,ithin a peiod of four (04) weeks from todag." The similar view was also taken in yet another writ petition by the Hon'ble Division Bench of the Andhra Pradesh High Court in W.p.No.283O of 2023 which stood decided on 74.02.2023, wherein erlso the Hon'ble Division Bench had reiterated the sarne view 6 il wherein paragraph Nos.6 and 7 has held as under:

A reading of Section 16O of the Act makes it very much clear and candid that the safeguards contained therein calnot be made applicable for the contingency in tl.e present case. Section 169 of the Act, which deals with the service of notice, enables the department to make available any decision, order, 4 Summons, Notice or other communication in the common portal. In the guise of the same, the signatures cannot be dispensed with. In the considered opinion of this court, t}re aforesaid provisions of law would not come to the rescue of ihe respondent herein, for justifying the impugned action.

For the a-foresaid reasons, this Writ Petition is a-llowed, setting aside the impugned order of the lst Respondent, dated 23- ll-2O22 and the DRC-07 notice, dated 23-11-2022 for the tax period 2Ol7- 18,2018-19 and 2Ol9-2O, as well as the show cause notice dated 22-lO-2O22 and DRC-Ol notice, dated 22- lO-2O22 issued by the lst Respondent and uploaded in the GST corrmon portal. However, this oider will not preclude the respondents from proceeding in accordance with law, in the light of ihe observations made Supra. There shall be no order as to costs."

There was yet another view from the Bombay High Court in W.P.No.933 I of 2022, decided on 21.Og.2022, wherein under similar circumstances, the Bombay High Court taking into consideration the provisions of Rule 26(3) of the CGST Rules 2O17, in paragraph Nos.43 to 45 held as under: 'Therefore, any person aggrieved by any decision or order passed under the Act may apply to the Appeltale Authority within three months from *re di[e on which such decision or order is communicated to such person. RuIe 26(3) of the 6 PSK,J & MI"R,.I W.P.No.7251 of 2024 Central Goods ald Services Tax Rules, 2Ol7 (the CGST Rules) and it is pari materia with Maharashtra Goods and Services Tax Rules, 2017 requires orders issued under Chapter III of the rules to be authenticated by a digita_l signature certificate or through Esignature or by any other mode of signature or verihcation notified in that behali Form GST-REG which was notified under the Rules for the purpose of passing order for cancellation of registration specihcally requires the signature of the officer passing the order. Respondent has not denied that aly order passed by respondent requires to be digitally signed and certifred.

It is petitioner's case that the order in origina.l dated 14th November 2019 which was impugned in the appeal frled before Respondent No.3 has not been digitally signed. Therefore, it was not issued in accordance with Rule 26 of the CGST Rules. Hence, the time limit for hling the appeal would begin only upon digitally signed order being made available_

Averments rr paragraph Nos.6, 7 and 8 of the petition reads as under:

With respect to the issue of li.mitation, the order which is appealed against, which is the Order for Cancellation of Registration dated 14 November 2019, is not signed by the Respondent No.4 who has issued the order. The said order is merely uploaded on the GST Portal without any signature. The signature was affi-xed for the hrst time only on 19 May 2O2l wher, Petitioner had to get arl attestation from Respondent No-4 for tie purposes of frling appeal. This attestation was required precisely because the Order for Carcellation of Registration dated 14 November 2019 was not signed.

Rule 26(3) of the Central Goods and Seryices Tax Rules, 2Ol7 and ttre parimate.ia Maharashtra Goods and Services Tax Rules, 2017 requires orders issued under Chapter III of the rules to be authenticated by a digitat signature certifrcate or through E-sigrature or by ary other mode of signature or verification notihed in this beha_lf. The Form GST-REG 19 which was notihed under the Rules for the purposes of passing order for cancellation of registralion specifrcally requires the signature of the officer passing the order.

Thus, the limitation period for flling the appeal against the Order for Cancellation of Registration dated 14 November 2019 never began because the Order was not signed in accordance with the rules. Alternatively, the limitation period began only from 19 May 2O2l which is the date on which the signature of the Respondent No.4 was put on the order for the purposes of "attestation'. The Order of Cancellation of Registration dated 14 November 2019 as well as the First Appeal Order dated 4 August 2O21 are therefore liabte to be quashed and set aside. In the affrdavit in reply it is not denied that the order in original dated 14th November 2019 was not digitaly siBTIed. In the affidavit in reply it is specilically stated that the show cause notice was refers to the order in original dated 14th November 2019 there is total silence about arry digital signature being put by the issuing authority. Conveniently, respondent stated that petitioner cannot take stand of not receiving the signed copy because the unsigned 4 /4 9O8-WP-9331-2O22 order was admittedly received by petitioner electronically. However, if this stand of respondent has to be accepted, then the Rules which prescribe specihca-Ily that digital signature has to be put will be rendered redundalt. In our view, unless digital signature is put by the issuing authority that order will have no effect in the eyes of law." Yet another matter came up before the High Court of Delhi in W.P.No.2872 of 2023, which stood decided on 03.02.2023, wherein in paragraph Nos.14 to 17 the High Court of Delhi has held as under: "Concededly, the impugned order cannot be sustained as it is unsigned. This issue is covered by the decision of a coordinate Bench of this Court in Railsys Engiaeers Private Limited & Aar. V. The Additional Commissioner of Central Goods aod Services Tax (Appeals-Il) & Anr. W.P.(C)'- .. 4712 /2022, decided ot 21..O7.2022.: 8

Considering the judicial precedents referred to in the preceding paragraphs, we are of the considered opinion that the impugned order in the instart case also since it is an un-signed document which lose its efhcacy in the light of requirement of RuIe 26(3) of the CGST Rules 2017 and also under the TGST Act ald Rules 2O17. The show cause notice as also the irnpugned order both would not be sustainable and the same deserves to be and are accordingly set aside/ quashed. However, the right of the respondents would stand reserved to take appropriate steps strictly in accordance with law governing the field.

Accordingly, this Writ petition stands alowed. No order as to costs. Consequenfly, miscellaneous petitions Pending, if ary, shall stand closed ASSISTANT R c.stREE GI R //II To SECTION OFFICER 1 . The State Hyderabad _Tax Officer 500001 IDA Gandhi Nagar, HYderabad Rural Nampally,

The Assistant Commiss roner of State Tax IDA Gandhi Nagar, Hyderabad Rural Nampalty, Hydera bad - 500001

The Com , Hyderaba mrssioner o d- 500001 f Commercial Taxes State of Telangana, C.T. Complex, Na mpally

The princi Buildings, al. Secretary (R yoerabad, State ) CT Department ngana Telangana, Secretariat p H evenue of Tela

The Secret 1 1 0001 ary, Minisky of Finance, North Block, New Delhi, Union of lndia_ 6- The Commissioner Central Board of lndirect Taxes and Customs , GST policy Wing, New Delhi BSR KKS

One CC to SRI VENKATA PRASAD.P , Advocate tOpUCl

One CC to SRt DOM|N|C FERNANDEs, sc FOR cBlT [oPUC]

One CC to S OF INDIA, High Court fo RI GADI PRAVEEN KU r the State oi MAR Telangana at Hyderabad DEPUTY SOLICITOR GENERI loPUCl AL 10.Two CCs to GP FOR COMMERCIAL TAXES High Court for the State of Telangana at Hyderabad [OUI 'I 1 . Two CD Copies \