Demand Order Valid Despite Missing Signature if Officer Details are Present

Demand Order Valid Despite Missing Signature if Officer Details are Present

Issue: Whether an Order-in-Original (OIO) or demand order issued by the adjudicating authority under the Goods and Services Tax (GST) Act is rendered invalid solely because it lacks the physical signature of the official who passed the order, provided the electronic communication contains the official’s full credentials.

Facts:

• The petitioner, M/s Future Consumer Ltd., received an Order-in-Original (OIO) that raised a tax demand.

• The petitioner challenged the OIO on the ground that it did not contain the signature of the official passing it.

• The OIO was, however, accompanied by Form GST DRC-07, which explicitly contained the name, designation, ward, and other details of the concerned officer.

• The petitioner also filed a rectification application against the OIO, which was rejected without an opportunity for a personal hearing.

Decision:

The Delhi High Court upheld the validity of the Order-in-Original (OIO) despite the missing signature. The Court reasoned that once the OIO is accompanied by a document (like Form GST DRC-07) that contains the full name, designation, and other details of the issuing official, the technical objection regarding the missing signature is “not tenable”.

Key TakeDowns:

• Substance Over Form: The ruling confirms the judicial view in the digital age that the substance of the authentication (the presence of official credentials and details) overrides the requirement for a physical signature. The GST portal mechanism, where the officer uploads the order with credentials, further supports this view. * Personal Hearing on Rectification is Mandatory: The Court severely criticized the rejection of the rectification application. It emphasized that a personal hearing is mandatory (in terms of the third proviso of Section 161 of the CGST Act) when rejecting a rectification application or when the rectification would adversely affect the assessee.

• Appeal Liberty Granted: Due to the clear infraction of the principles of natural justice in rejecting the rectification application, the petitioner was granted liberty to file an appeal against the OIO, and the Appellate Authority was directed to decide the appeal on merits, without dismissing it on the grounds of limitation.