9911796707
TMI Blog2025 (4) TMI 1152X X X X Extracts X X X X X X X X Extracts X X X X ..... rit petitioner was served with a show cause notice under Section 74 of the CGST/SGST Act dated 5.8.2024 proposing to initiate proceedings under Section 74 (10) of the CGST/SGST Act for the assessment years 2017-2018, 2018-2019, 2019-2020, 2020-2021 and 2021-2022. In the aforesaid notice, the proper officer concluded that, for different assessment years, the appellant/writ petitioner had applied incorrect HSNs, and therefore, the rate of tax applied is incorrect and thus proposed a reassessment finding that there is a wrong application of tax rate at Rs. 21,13,080/- (CGST - Rs. 10,56,540/ - SGST- Rs. 10,56,540/-). The appellant immediately approached this Court by the writ petition questioning Ext.P1 show cause notice on the ground that, goi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... om 214 (Kerala)], wherein it was held by the Division Bench, wherein one of us was a party [DR. A.K. Jayasankaran Nambiar (J)] that the proper officer cannot issue consolidated orders by clubbing into different assessment years for the purpose of determining the liability under Section 74 of the Act. It is further pointed out that the High Court of Karnataka in M/s Bangalore Golf Club (Supra) had taken a view that a composite show cause notice by clubbing different assessment notices cannot be issued. It is further pointed out that the Madras High Court in M/s Titan Company Limited v. Joint Commissioner of GST [W.P. No.33164 of 2023] also has taken a similar view. 5. On the other hand, Sri. V.K. Shamsudheen, the learned Senior Government P ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ths prior to the time limit specified in sub-section (10) for issuance of order. 8. Sub-section (2) of Section 74 mandates that the notice under sub-section (1) of Section 74 be issued at least six months prior to the time limit prescribed under sub-section (10) for issuance of the order. Turning to sub-section (10) of Section 74, the proper officer is required to issue notice under sub-section (9) within a period of five years from the due date of furnishing the annual return. 9. A cumulative reading of Section 74 (1), (2) and (10) leaves no room for any doubt that each assessment year can be proceeded separately by the assessing officer or the proper officer as the case may be for the purpose of determining whether there is any willful ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ories (supra) this issue did not fall for our consideration. 11. When we read sub-sections (9) and (10) of Section 74, which specifically refer to " financial year to which the tax not paid or short paid or input tax wrongly availed or utilised relates" while passing the final order of adjudication, it presupposes that independent show cause notice be issued to the assessee for each different years of assessment while proceeding under Section 74. We are constrained to hold so because, as we noted earlier, the assessee can raise a distinct and independent defence to the show cause notice issued in respect of different assessment years. In other words, the entitlement to proceed and assess each year being separate and distinct, and further t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ferent assessment years, a separate show cause notice has to be issued. Still further, since proper officer need to issue a show cause notice prior to 6 months to the time limit prescribed under sub-section (10) of Section 74, if a composite notice is issued, the assessee will be prejudiced inasmuch as the availability of a lesser period to submit a proper and meaningful explanation. This also is a strong indicative factor which would prompt us to hold in favour of the assessee. 13. We find normally a writ petition against the show cause notice is not to be entertained by the writ court as held by us in Deputy Commissioner of Intelligence v. Minimol Sabu (W.A. No. 238 of 2025), we have carved out the exceptions like in a case where a total ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e have condoned the delay in preferring the appeal and that the period of completion of assessment having expired in the meantime and that since we have interfered with the show cause at this stage due to the reasons explained above, we feel it is only just and proper that the entire exercise be re-done by the authorities concerned. Therefore, while sustaining Ext.P1 notice for the period 2017-2018, we make it clear that the period spent before this Court from 8.11.2024 till today shall stand excluded for the purpose of computing the period of limitation under sub-section (10) of Section 74. Thus, we permit the appellant to submit his reply to Ext.P1 notice within a period of three weeks from today and further grant liberty to the responden ..... X X X X Extracts X X X X X X X X Extracts X X X X
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