2026-VIL-1070-BOM
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SGST High Court Cases

GST - Permissibility of clubbing or consolidating multiple financial years in show cause notice issued under Section 74 of CGST Act - Respondent issued SCN covering financial years 2019-20 to 2021-22, alleging suppression of taxable value and short payment of GST - Petitioner challenged notice on ground that clubbing of different financial years/tax periods in single show cause notice is not permissible - Whether authority has jurisdiction to issue consolidated show cause notice covering different financial years/tax periods - HELD - GST scheme is based on annual returns for each financial year with statute fixing five year time limit for demanding and recovering tax from due date for furnishing annual return for that year or from date of erroneous return. Each financial year constitutes separate tax period with different due dates and different limitations - Statute treats each financial year as separate tax period for purpose of assessment and recovery – Further, the judgment of Delhi High Court in M/s Mathur Polymers permitting consolidation in fraud cases does not apply as Supreme Court declined to interfere in limine, not on merit, therefore doctrine of merger of judgment does not apply. The Bombay High Court judgments in M/s Milroc Good Earth Developers and Rite Water Solutions are binding authority – The clubbing of Show cause notice for various financial years/tax periods is not permissible. Show cause notice consolidating different financial years is quashed and set aside - Respondent at liberty to re-issue notice strictly in terms of provisions of Section 74 if no other legal impediment - The petition is disposed of
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GST & Customs updates: Sep'26
By CA Vivek Jalan

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