Year wise limitation prevents aggregation of multiple tax periods into a single Section 74 show cause notice, rendering consolidated notices invalid.

A consolidated show cause notice purporting to club alleged tax defaults across multiple financial years is impermissible because the statutory scheme treats each financial year as a separate tax period with distinct limitation and assessment timelines under the CGST framework; the court applied the year wise limitation principle and held that even allegations of fraudulent input tax credit do not authorise aggregation of different tax periods into one Section 74 notice. The impugned consolidated notice dated 26/06/2025 was quashed; respondents may issue notices only in strict conformity with Section 74 and applicable limitation rules.

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Issues: (i) Whether a show cause notice under Section 74 of the Central Goods and Services Tax Act, 2017 can validly consolidate or club alleged tax defaults across multiple financial years/tax periods.

Analysis: The Court examined the statutory scheme of the Central Goods and Services Tax Act, 2017 concerning tax periods, return filing and limitation for assessment and recovery, including the treatment of each financial year as a separate tax period (Section 2(106); Sections 39, 44, 37, 50) and the separate operation of time limits for issuance of assessment/orders under Sections 73(10) and 74(10). The Court considered and followed prior Division Bench decisions which held that the statute prescribes year-wise limitation and assessment structure and does not permit aggregation of different tax periods into a single consolidated show cause notice. The Court rejected the proposition that alleged fraudulent availment of input tax credit permits clubbing of multiple years into one show cause notice, noting that fraud-related cases remain subject to the same year-wise limitation framework under Section 74 and related provisions. The Court also addressed conflicting authority and explained that subsequent decisions of this Court on the point bind the authorities below unless set aside by a competent court.

Conclusion: The Court concluded that issuance of a consolidated show cause notice under Section 74 of the Central Goods and Services Tax Act, 2017 covering multiple financial years/tax periods is not permissible; this conclusion is in favour of the assessee. The impugned consolidated show cause notice dated 26/06/2025 is quashed and set aside. The respondents remain at liberty to issue notices strictly in accordance with Section 74 of the Central Goods and Services Tax Act, 2017 and applicable limitation rules.

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