Desk of CA. Praveen Sharma – 1044 Series (CAPS) 

 Bombay High Court IN THE CASE OF Milroc Good Earth Developers Pvt. Ltd. v. Union of India & Ors.

Bombay High Court: One Financial Year = One GST Show Cause Notice

The Bombay High Court, in the case of Milroc Good Earth Developers Pvt. Ltd. v. Union of India & Ors., has provided important relief to GST taxpayers.

The Court held that the GST Department cannot issue a single Show Cause Notice (SCN) covering multiple financial years under Sections 73 or 74 of the CGST Act. Since GST is a return-based tax system, every financial year is treated as a separate unit for assessment and adjudication.

The Court observed that issuing one consolidated SCN for different years can prejudice taxpayers because each year has its own facts, evidence, legal issues, and limitation period. Administrative convenience cannot override the provisions of the GST law or the principles of natural justice.

Accordingly, the High Court quashed the composite SCN and allowed the department to issue fresh notices separately for each financial year, if permissible under law.

Key Takeaway: Under GST, one financial year should have one separate Show Cause Notice. Tax authorities cannot club multiple financial years into a single SCN merely for administrative convenience.

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