Case Law Details
RioCare India Private Limited Vs Assistant Commissioner CGST and C.Ex. & Ors. (Bombay High Court)
Bombay High Court ruled in the case of RioCare India Private Limited vs. Assistant Commissioner CGST and C.Ex. that a single show cause notice (SCN) under Section 74 of the Central Goods and Services Tax (GST) Act, 2017, can be issued for multiple financial years. RioCare India had challenged a notice dated December 4, 2024, covering the period from July 1, 2018, to March 31, 2023, arguing that separate notices should have been issued for each financial year. The petitioner sought to have the notice quashed and requested that authorities be restrained from acting upon it.
The court, however, found no restriction in Section 74 that would prevent the tax authorities from issuing a consolidated notice for multiple years. It noted that the provision allows authorities to demand unpaid or short-paid taxes, erroneous refunds, or improperly availed input tax credits due to fraud, misstatements, or suppression of facts. The court also observed that there was no issue of limitation under Section 74(10) in this case. Consequently, it dismissed the petition, stating that the petitioner must respond to the SCN and present arguments before the appropriate authority. No costs were imposed, and the order was digitally signed for official record-keeping.
FULL TEXT OF THE JUDGMENT/ORDER OF BOMBAY HIGH COURT
1. The above Writ Petition seeks Writ of Certiorari to quash and set aside the show cause-cum-demand notice dated 4th December 2024 issued to the Petitioner under Section 74 of the Central Goods and Services Tax Act, 2017 for the period 1st July 2018 to 31st March 2023. The other relief sought is to restrain the Respondents or prohibit them from acting further and/or taking any steps and/or act pursuant to the said impugned show cause notice.
2. The only ground canvassed before us by the learned advocate appearing on behalf of the Petitioner is that the impugned show cause notice relates to different financial years and therefore for each financial year a separate show cause notice ought to have been issued. One show cause notice for the period 1st July 2018 to 31st March 2023 was impermissible, was the argument.
3. At least prima facie we are not impressed with this argument. There is nothing in Section 74 and more particularly 74(1) which would prohibit the Authority from issuing a notice calling upon the assessee to pay tax that has not been paid or short paid or erroneously refunded or where input tax credit has been wrongly availed or utilised, by reason of fraud, or any wilful misstatement or suppression of facts to evade tax. At least prima facie, a notice under Section 74(1) can be issued for any period provided said notice is given at least 6 months prior to the time limit specified in sub-section (10) of Section 74 for issuance of the order.
4. In the present case, admittedly there is no issue of limitation as contemplated under Section 74(10). In these circumstances, at least prima facie we are not satisfied that this Writ Petition ought to be entertained and which is challenging the show cause notice. The Petitioner will have to face the show cause notice and can canvass all arguments before the authority concerned, including the issues raised in the present Writ Petition.
5. The Writ Petition is accordingly disposed of. However, there shall be no order as to costs.
6. This order will be digitally signed by the Private Secretary/ Personal Assistant of this Court. All concerned will act on production by fax or email of a digitally signed copy of this order.
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