Limitation to Issue SCN under Sec 74(2)

[VENU K]

Dear Experts

I have received an SCN under Sec 74 for FY 2020-21. Now the question is, is this valid ?

For FY 2020-21

Annual return due date: 28.02.2022

5 years under Section 74(10): 28.02.2027

6 months prior under Section 74(2): 28.08.2026

So an SCN issued on 31.08.2026 gives me a prima facie limitation objection under Section 74(2).

Views of Experts solicited based on wordings of Sec 74(2)."The proper officer shall issue the notice under sub-section (1) at least six months prior to time limit specified in sub section (10) for issuance of order".

AI Summary

Section 74 SCN limitation requires issuance at least six months before the deadline for passing the order.
Limitation for issuing a show cause notice under Section 74 for FY 2020-21 is examined by reference to the annual return due date and the order deadline under Section 74(10). Where the order deadline is 28 February 2027, Section 74(2) requires notice issuance at least six months earlier, namely by 28 August 2026. A notice issued on 31 August 2026 raises a prima facie limitation objection.