State Bank of India Vs Commercial Central Goods and Service Tax and Central Excise (Calcutta High Court)
Summary: The Calcutta High Court held that a single show-cause notice issued under Section 74 of the Central Goods and Services Tax Act, 2017 covering multiple financial years was impermissible and without jurisdiction. State Bank of India challenged a composite show-cause notice dated June 25, 2025 and consequential order-in-original dated December 12, 2025 concerning financial years 2018-19 to 2023-24. The order confirmed GST demand of Rs.5,48,56,775/- together with interest and an equivalent penalty. SBI contended that each financial year constitutes a separate unit for limitation purposes under Section 74 and that clubbing several years through one notice effectively enabled the Department to revive demands otherwise barred by limitation. The Court analysed Sections 2(106), 73 and 74 and held that Section 74(10), by linking limitation to “the financial year”, treats each financial year separately. Reading Sections 74(1), (2), (3), (4) and (10) together with the statutory definition of “tax period”, the Court concluded that a notice may correspond to the relevant monthly or annual return period but cannot combine multiple financial years. The Court followed the reasoning in Titan Company Limited and Milrue Good Earth Developers and relied upon the Supreme Court’s principle concerning separate assessment years in State of Jammu and Kashmir v. Caltex (India) Ltd. It further held that the statutory appellate remedy did not bar the writ petition because the jurisdictional defect was apparent on the face of the record and required no factual enquiry, relying upon Godrej Sara Lee Ltd. Vs Excise and Taxation Officer-cum-Assessing Authority & Ors. The Court consequently quashed both the show-cause notice and order-in-original, while permitting the revenue authorities to proceed afresh strictly in accordance with law.
