JUDGMENT :

Deepak Roshan, J.

Heard learned counsel for the parties.

2. Since both these writ applications are interconnected and common issue is involved, as such both are being heard together and disposed of by this common judgment.

3. Writ Petition No. 3908 of 2020 pertains to the Financial Year 2017-18 wherein the petitioner prayed for quashing and setting aside “summary of the order” as contained in Form-GST DRC 07 dated 11.09.2020 issued by respondent no.4 whereby the petitioner was directed to make payment of tax, interest and penalty. Similarly Writ Petition No. 3909 of 2020 pertains to Financial Year 2018-19 wherein petitioner has made similar relief for quashing “summary of the order” as contained in Form-GST DRC 07 dated 11.09.2020.

4. The brief facts of the case are that the petitioner is a Public Limited Company and is primarily engaged in the business of trading of coal. Petitioner for the purpose of trading of coal, purchases coal primarily from various subsidiaries of Coal India Limited including various Government entities like Jharkhand State Mineral Development Corporation, Heavy Engineering Corporation Limited as well as other similarly situated coal traders. It further transpires that the petitioner is having its business in various states of the country including the State of Jharkhand and State of West Bengal and the petitioner sells its purchased coal to its customers which are primarily Government undertakings like MSTC Limited, West Bengal Mineral Development and Trading Corporation Limited etc. It further transpires that the petitioner is regularly issued work orders by MSTC Limited, West Bengal Mineral Development and Trading Corporation Limited and others like entities towards supply of coal and in order to meet the said supplies, the petitioner procures coal from various sources mentioned hereinabove.

5. From the pleadings of the writ application, it further transpires that petitioner also purchased coal from other traders like R.S. Fuels Private Limited; Sandoz Impex Limited, Shri Ram Coal Traders and Sendoz Commercials who are also engaged in the business of trading of coal. As per the business module of the petitioner, in a particular period of time, the petitioner may have shortage of coal in order to fulfill its trade commitments requiring the petitioner to purchase coal from other traders mentioned above and, similarly, it may happen that the said traders like R.S. Fuel Private Limited at a particular point of time, may also have shortage of coal and, thus, would be required to purchase coal from other traders including the petitioner thus, there were inter-se purchase and sale transaction by and between the petitioner and other coal traders mentioned hereinabove.

6. The respondents carried out an inspection under Section 67 of the Jharkhand Goods Service Tax Act, 2017 in the registered premises of the petitioner. Vide inspection report dated 28.01.2019, the petitioner was directed to produce documents pertaining to movement of goods relating to purchase and sale transactions of the petitioner in exercise of powers under Section 71(2) of the CGST Act. In the said inspection report itself, it was mentioned that if the petitioner fails to produce the relevant documents as directed, proceedings for adjudication under Section 73/74, as the case may be, would be initiated against the petitioner.

7. From the record it further transpires that various communications were exchanged between the petitioner and the Respondents-State Tax Authorities and the petitioner produced several documents to demonstrate its claim towards genuineness of the transactions of purchase and sale of coal made by the petitioner. However, the Respondent-authorities were not convinced with the documents furnished by the petitioner and, accordingly, in terms of the provisions of Section 73(5)/74(5) of the GST Act read with Rule 142(1A) issued an intimation to the petitioner in Form GST DRC-01A dated 29.01.2020 directing the petitioner