Summary Forms DRC-01/07 Cannot Replace Proper GST SCN and Order: Gauhati High Court

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In its 16 July 2025 order in W.P.(C) No. 471/2025, the Gauhati High Court quashed a summary SCN and order issued to Air Transport Corporation Assam Pvt. Ltd., holding that statutory SCNs and adjudication orders under Sections 74 and 75 cannot be replaced by summary forms.

🏛️ Case: Air Transport Corporation Assam Pvt. Ltd. v. State of Assam & Ors.

W.P.(C) No. 471 of 2025 | Order delivered: 16 July 2025

⚖️ Factual Background

  • Summary SCN issued on 28 September 2023, and a summary order passed on 29 December 2023, using GST Form DRC‑01 and DRC‑07, respectively.
  • Petitioner—Air Transport Corporation Assam Pvt. Ltd.—alleged no formal SCN under Section 74(1) of the CGST Act was issued, and they were denied a personal hearing despite requests.

🧠 Legal Issues

  1. Can a summary SCN (DRC‑01) issued instead of a statutory SCN under Section 74(1) sustain proceedings?
  2. Is the summary order valid without granting an opportunity of personal hearing as mandated by Section 75(4)?

🔍 Court’s Analysis & Judgment

  • The Court applied Para 29 of the Construction Catalysers judgment (WP(C) No. 3912/2024, dated 26 September 2024), which decisively held:
    • Summary SCN (DRC‑01) is not a substitute for a formal SCN required under Section 73(1) or Section 74(1). Initiating proceedings via a summary notice alone is legally impermissible.
    • Similarly, the summary order (DRC‑07) cannot replace the detailed statutory adjudication order, and both SCN and order must be issued and digitally authenticated by a Proper Officer under Rule 26(3).
    • Non‑compliance with Section 75(4) by denying the petitioner an opportunity for personal hearing rendered the order legally unsustainable.
  • Consequently, the High Court:
    • Set aside both the summary SCN dated 28 Sept 2023 and the summary order dated 29 Dec 2023, pursuant to the doctrine established in Construction Catalysers.
    • Granted liberty to the tax authorities to initiate de novo proceedings under Section 74 with full statutory compliance.
    • Ordered exclusion of the period between issuance of the summary notice and the judgment’s certified copy from limitation period computation under Section 74(10).

🗂️ Why This Case Matters

  • Reinforces that Form GST DRC‑01 (summary SCN) and DRC‑07 (summary order) are insufficient substitutes for formal, detailed, and authenticated documents as mandated by Sections 74/75 and Rule 26(3).
  • Clearly underscores the vital right to personal hearing before an adverse order is passed.

  • Affirms judicial approach: quash defective proceedings while allowing corrective remand in a procedurally fair manner.

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