Composite GST Show Cause Notices Issued Across Multiple

Composite GST Show Cause Notices Issued Across Multiple Financial Years Under Section 73 Are Legally Unsustainable

Issue

Whether a single composite Show Cause Notice (SCN) issued under Section 73 covering multiple financial years (2018-19 to 2022-23) and the consequential Order-in-Original are legally valid under the Goods and Services Tax framework.

Facts

Issuance of Composite SCN: The Revenue issued a single composite Show Cause Notice (SCN) covering five financial years (2018-19 to 2022-23) under Section 73.
Passing of Order-in-Original: Following the composite SCN, the adjudicating authority passed a consequential Order-in-Original for the multiple periods combined.
Writ Petition: The petitioner challenged the composite SCN as impermissible and the consequential order as legally unsustainable before the High Court.
Reliance on Precedents: The petitioner relied on Division Bench decisions establishing that composite show cause notices spanning multiple financial years are not legally sustainable.

Decision

In Favor of Assessee: The composite Show Cause Notice and the consequential Order-in-Original were quashed.
Application of Settled Law: The court applied binding Division Bench principles, holding that issuing composite notices for multiple assessment years under Section 73 is impermissible.
Liberty and Limitation: Liberty was granted to the Revenue to issue separate, individual notices for each relevant financial year. The period from the date of the SCN until the receipt of the certified copy of the judgment was excluded from limitation calculations. All other contentions were left open.

Key Takeaways

Year-Wise Notice Requirement: Section 73 requires the Revenue to issue separate show cause notices for each distinct financial year rather than bundling multiple periods into a single notice.
Invalidation of Derivative Orders: Any adjudication order or Order-in-Original arising from an invalid composite SCN is legally unsustainable and liable to be quashed.

HIGH COURT OF KERALA

Fairmart

Deputy Commissioner

ZIYAD RAHMAN A.A., J.

WP(C) NO. 29187 OF 2026

AUGUST 21, 2026

Kiran Ramachandran Nair, Smt.Vandana Bhat T.V., Aji V. Dev, Alan Priyadarshi Dev and S. Sajeevan, Advs. for the Petitioner. Gireesh G., Sr. Government Pleader for the Respondent.

JUDGMENT

1. This writ petition is submitted by the petitioner challenging Ext.P1 composite Show Cause Notice which was issued by the respondents for multiple financial years namely, 2018-2019 to 2022-2023 and Ext.P2 Order-in-Original. The main challenge raised against the sustainability of the same is that, issuance of a composite notice for multiple assessment years was found to be not legally sustainable as per the decision rendered by this Court in Joint Commissioner (Intelligence & Enforcement) v. Lakshmi Mobile Accessories 108 GST 750/95 GSTL 356 (Kerala)/[2025 KHC OnLine 149] andTharayil Medicals v. Deputy Commissioner, SGST Department, Thrissur (Kerala)/[2025 KHC OnLine 467].

2. After hearing the learned counsel for the petitioner and the learned Standing Counsel for the respondents, I find merits in the said submission, in view of the fact that, such a finding was indeed entered into by the Division Bench of this Court in the decisions referred to above.

In such circumstances, in the light of the principles laid down by this Court in the above referred judgments, an interference is required. Accordingly, this writ petition is disposed of, quashing Ext.P1 and Ext.P2, granting liberty to the respondent to issue separate notices for the relevant assessment years. However, the period from the date of Ext.P1 till the date of receipt of certified copy of the judgment shall be excluded while computing the period of limitation for initiating fresh proceeding. All the other contentions of the parties are left open.