Consolidation of single show-cause notice for multiple years allowed for fraudulent ITC; appeal maintainable under Section 107 CGST Act

HC held that consolidation of a single show-cause notice for multiple years is permissible where the primary allegation is fraudulent availment of Input Tax Credit. The petition was disposed with liberty to the petitioner to file an appeal by 30 September 2025 with requisite pre-deposits; if filed within that period the Appellate Authority shall not reject it on limitation grounds and must decide it on merits. The impugned order remains appealable under Section 107 of the CGST Act.

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Issues: Whether a single consolidated Show Cause Notice (and consequent order) can be validly issued in respect of alleged wrongful or fraudulent availment/utilisation of Input Tax Credit covering transactions across multiple years.

Analysis: The Court examined Sections 73 and 74 of the CGST Act, 2017 which use the expressions "for any period" and "for such periods" in subsections relating to issuance of notices and statements, contrasted with provisions using the term "financial year" for limitation purposes. The Court noted that where fraudulent availment or utilisation of ITC is alleged, establishing the fraudulent scheme often requires connecting transactions across different tax periods/financial years and that the statutory language contemplates notices/statements covering periods beyond a single financial year. The Court relied on the reasoning that subsections permitting service of statements for periods other than those in the earlier notice (subject to same grounds) and the nature of the ITC mechanism support consolidation of periods in fraudulent ITC cases. The impugned order set out year-wise amounts and the matter was appealable under Section 107; the Court therefore confined relief to permitting the petitioner to pursue the statutory appeal with prescribed pre-deposit and directed that the appeal not be rejected on limitation grounds if filed within the stipulated time.

Conclusion: The issuance of a consolidated Show Cause Notice and order for multiple periods in cases of alleged fraudulent or wrongful availment/utilisation of ITC is permissible; the petition challenging the impugned order is disposed of without quashing the order and with liberty to the petitioner to file an appealoutcome is against the petitioner (in favour of the Revenue).

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