Composite Assessment Order and SCN Covering Multiple Financial

Composite Assessment Order and SCN Covering Multiple Financial Years Under Section 73 Is Legally Unsustainable

Issue

Whether a single composite Show Cause Notice and subsequent assessment order passed under Section 73 covering multiple tax periods (FY 2020-21, 2021-22, and 2022-23) is legally valid.

Facts

Assessee Profile: The petitioner is a GST-registered trader dealing in granite blocks.
Periods Involved: 2020-2021, April 2021 – March 2022, and April 2022 – March 2023.
Impugned Action: The respondent issued a single composite assessment order covering all three tax periods without passing separate period-wise orders, while also imposing a 100% penalty.
Writ Petition: The petitioner challenged the composite order directly via a writ petition without exhausting the alternative remedy of an administrative appeal.
Revenue’s Defense: The respondents raised preliminary objections regarding the availability of an alternate remedy and cited a pending Special Leave Petition (SLP) against a coordinate bench ruling.

Decision

Held, yes; a composite assessment order spanning multiple tax periods is legally unsustainable under Section 73 [Paras 6 and 8].
The court observed that examining other factual grounds was unnecessary as the dispute was squarely settled by the invalidity of the composite assessment structure [Paras 6 and 8].
A single Show Cause Notice (SCN) or a single assessment order cannot encompass more than one tax period [Paras 6 and 8].
Permitting common/composite orders for multiple financial years impairs statutory safeguards, prejudices appeal rights, and renders statutory provisions otiose [Paras 6 and 8].
The impugned composite assessment order was set aside [Paras 6 and 8].
Verdict: Decided in favour of the assessee.

Key Takeaways

Mandatory Year-Wise Adjudication: Each tax period/financial year represents a distinct cause of action under Section 73; proceedings must be initiated and finalized through period-specific notices and orders.
Protection of Statutory Remedies: Combining multiple years into a single order confuses limitation periods, calculation of monetary limits, and appellate jurisdictional thresholds.
Maintainability of Writ Petitions: An alternate remedy bar does not restrict the High Court from setting aside an order under Article 226 when the fundamental procedure is jurisdictionally flawed.

HIGH COURT OF ANDHRA PRADESH

Vishwa Vinayaka Build Tech

State of Andhra Pradesh

Ninala Jayasurya and T.C.D. Sekhar, JJ.

Writ Petition No. 22163 of 2026

AUGUST 20, 2026

S. Appadhara Reddy, Counsel for the Petitioner. R. Kalyan Chakravarthy, Ld. Govt. Pleader for the Respondent.

ORDER

1. The Court made the following Order: (per Sri Justice Ninala Jayasurya) Heard learned counsel for the petitioner. Also heard Mr. R.Kalyan Chakravarthy, learned Government Pleader for Commercial Tax representing the respondent Nos.1 to 3.

2. Petitioner registered under Goods and Services Tax Act, 2017 (for short “the Act”) with GSTIN:37AAOFV8238M1Z7, is engaged in the business of selling of granite blocks. Aggrieved the common Assessment Order dated 13.04.2024 issued by respondent No.3 in imposing 100% penalty, filed the present writ petition on various grounds.

3. Learned counsel for the petitioner while referring to the various averments in the affidavit filed in support of the writ petition, made submissions inter alia that the order of respondent No.3 covering tax period for the different Assessment Years i.e., 2020-2021, April 2021 – March 2022 and April 2022 to March 2023, is not sustainable, in the light of the decision rendered by this Court in S J Constructions v. Asstt. Commissioner 102 GSTL 348 (Andhra Pradesh)/(W.P No.11028 of 2025) dated 17.09.2025 and seeks to allow the writ petition by setting aside the impugned order.

4. On the other hand, learned Government Pleader, while refuting the said contentions sought to sustain the impugned order. His submission is that the petitioner instead of availing the remedy of appeal had straightaway filed the present writ petition and the same is not maintainable. However, he has not disputed the decision rendered by this Court in S J Constructions (referred to supra), but states that an appeal has been preferred against the said decision before the Hon’ble Supreme Court and notice in the delay petition was ordered.

5. This Court has considered the submissions made and perused material on record.

6. Though several contentions were raised in the writ petition, this Court feels it not necessary to examine the same in detail. Suffice to state that impugned order is liable to be set aside on the ground that the same is a composite order covering the tax periods 2020-2021, April 2021 – March 2022 and April 2022 to March 2023.

7. In W.P No.11028 of 2025 & batch, a co-ordinate Bench of this Court vide order dated 17.09.2025 held as follows:

“17. Section 74(3) is in parimateria with Section 73(3). However, sub- section (4) of Section 74 does not contain the term “such tax period”. This non mention would not, in our opinion, make any difference to the aforesaid interpretation. Apart from this, there are certain other provisions, which would also have to be considered. Any interpretation of an Act should not result in some of the other provisions becoming otiose or reduced in scope. As rightly pointed out by the Hon’ble High Court at Madras, the right of a registered person to obtain benefit under Section 128 of APGST Act as well as the right to invoke the remedy of appeal against the orders of assessment either under Section 73 or under Section 74 would get impacted if a common order is permitted to be issued in relation to more than one assessment / financial year.

18. In the circumstances, we are of the opinion that a single show cause notice or a single composite assessment order cannot be passed in relation to more than one tax period of either a month if the assessment is taken up before the due date for filing of the annual return or for more than one year if the due date for filing of annual return has been reached.”

8. In the light of the above cited decision and for reasons alike, the impugned order is set aside. Writ Petition is disposed of, as indicated above.

9. Needless to observe that respondent No.3 is at liberty to issue separate notices in respect of relevant tax periods and proceed with the assessments in accordance with law, after giving opportunity to the petitioner, however, subject to condition of the petitioner depositing 30% of the penalty amount within a period of six (06) weeks from today. No costs. Miscellaneous petitions pending, if any, shall stand closed.