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High Court holds SCN for FY 2020-21 cannot be issued after 28 November 2024
This Tax Alert summarizes a recent ruling of the Andhra Pradesh High Court (HC)[1] regarding the period of limitation for issuance of show cause notice (SCN) for the financial year (FY) 2020-21 under section 73 of the Andhra Pradesh Goods and Services Tax Act, 2017 (APGST Act).
As per the provisions of section 73(2), the proper officer shall issue the notice at least 3 months prior to the time limit specified for issuance of order. The order needs to be passed within 3 years from the due date of annual return which was 28 February 2022.
The petitioner challenged the SCN dated 30 November 2024 on the ground that the last date to issue SCN was 28 November 2024.
The key observations of the HC are:
- The judgments[2] cited by the petitioner established that when a period is defined in terms of months, then the corresponding date of the corresponding month would be the cutoff date.
- In the instant case, the cutoff date for issuing an order is 28 February 2025, making the three months period elapse on 28 November 2024.
- GST law has put in place certain protections for taxpayers, and it is settled law that the period of limitation is mandatory, beyond which no orders can be passed.
Accordingly, HC quashed the SCN dated 30 November 2024 holding that any violation of the time period prescribed cannot be condoned and would render the show cause notice otiose.
Comments
Taxpayers who have received the SCNs under section 73 for FY 2020-21 beyond 28 November 2024 may rely on this ruling to challenge the validity of such notices.
[1]2025-VIL-124-AP [2]2010-VIL-107-SC and 1981(2) W.L.R.609 (HL)