Rollmet LLP Vs Union of India (Bombay High Court)
The case concerns a batch of petitions before the Bombay High Court challenging the validity of consolidated show-cause notices issued under Sections 73 and 74 of the Central Goods and Services Tax Act, 2017 (CGST Act). The central issue is whether the tax authorities can issue a single show-cause notice covering multiple financial years, or whether such notices must be issued separately for each financial year in line with statutory provisions.
The petitioners argued that the CGST Act mandates period-wise assessment and imposes year-specific limitation periods under Sections 73(10) and 74(10). They contended that issuing a consolidated notice covering multiple financial years violates this scheme and is without jurisdiction. Reliance was placed on earlier decisions, particularly the ruling in Milroc Good Earth Developers, as well as similar views taken by other High Courts, which held that clubbing multiple financial years into a single notice is impermissible.
Conversely, the revenue authorities argued that the Act does not prohibit consolidated notices. They submitted that limitation periods apply independently to each financial year, and consolidation is merely procedural, not affecting statutory timelines. It was further argued that Sections 73(1), 73(3), 74(1), and 74(3) permit issuance of notices and statements for “any period” or “such periods,” indicating legislative intent to allow coverage of multiple periods. The department also relied on contrary judicial precedents, including decisions of the Delhi and Allahabad High Courts, which upheld the validity of consolidated notices. Additionally, reference was made to orders of the Supreme Court of India dismissing challenges to such decisions, including in Mathur Polymers.
