Writ Against GST SCN Not Maintainable Where Factual Disputes Require Adjudication: Gauhati High Court
A recent ruling of the Gauhati High Court has reiterated that a writ petition challenging a GST show cause notice (SCN) is not maintainable where the challenge involves factual issues requiring adjudication by the proper officer.
In Gias Uddin Ahmed v. Union of India, the Court held that a consolidated demand-cum-show cause notice covering multiple financial years was permissible under the CGST Act. The Court further held that whether proceedings were correctly initiated under Section 73 or Section 74 of the CGST Act involved factual determination which could not ordinarily be undertaken in writ jurisdiction at the notice stage.
Background
The petitioners challenged a demand-cum-show cause notice dated 17 April 2024 issued by the Deputy Director, DGGI, Guwahati Zonal Unit. The notice covered four financial years, and the petitioners primarily challenged the permissibility of issuing a consolidated SCN for multiple periods. They also contended that the proceedings, if maintainable at all, ought to have been initiated under Section 73 rather than Section 74 of the CGST Act and were therefore barred by limitation.
Although the SCN required a reply within 30 days, the petitioners did not submit a reply. Instead, they approached the High Court nearly one year after issuance of the SCN. No adjudication order had been passed by the proper officer during this period.
The petitioners therefore sought to challenge the proceedings directly under Article 226 of the Constitution.
Gauhati High Court's ruling
The High Court rejected the challenge to the consolidated SCN. On the issue of whether a single SCN could cover multiple financial years, the Court relied upon its earlier decision in Tata Projects Ltd. v. Union of India, (2026) 43 Centax 473 (Gau.), wherein it had held that there was no bar on issuing a consolidated SCN or passing a consolidated adjudication order covering different financial years under Sections 73 or 74 of the CGST Act.
The Court thereafter considered the petitioners' contention that the proceedings ought to have been initiated under Section 73 rather than Section 74. According to the Court, determining whether fraud, wilful misstatement or suppression of facts existed requires factual adjudication by the proper officer. Such factual issues could not be determined by the High Court in writ proceedings at the SCN stage.
The Court also noted that statutory appellate remedies are available against orders passed under Sections 73 and 74, including an appeal before the Appellate Authority under Section 107 and a further appeal before the Appellate Tribunal under Section 112 of the CGST Act.
Accordingly, the Court declined to entertain the writ petition. However, in the interests of justice, the petitioners were granted 30 days to submit their reply to the SCN, with liberty to raise their other contentions before the proper officer. The period from 18 April 2024 until the date of judgment was also directed to be excluded while computing the limitation period for adjudication.
Practical implications
The ruling is particularly relevant for taxpayers seeking to challenge GST proceedings at the show cause notice stage. While writ jurisdiction may be invoked in appropriate circumstances, a challenge involving factual disputes concerning the applicability of Section 73 or Section 74 is ordinarily required to be addressed before the proper officer.
The decision also reinforces that a consolidated SCN covering multiple financial years is not, by itself, a ground for invalidating GST proceedings, particularly in view of the Court's earlier ruling in Tata Projects Ltd.
Taxpayers should therefore carefully assess whether the challenge raises a pure question of law or requires examination of disputed facts before approaching the writ court.
Conclusion
The Gauhati High Court's ruling in Gias Uddin Ahmed reiterates the importance of allowing the statutory adjudication process to operate where the dispute involves factual determination.
While the Court held that consolidated SCNs covering multiple financial years are permissible, it declined to determine at the notice stage whether the proceedings should fall under Section 73 or Section 74, observing that such determination requires examination of the factual foundation by the proper officer.
The decision therefore reinforces that a taxpayer cannot ordinarily bypass the statutory adjudication mechanism by invoking writ jurisdiction merely to contest factual aspects of a GST show cause notice.
Case Citation: Gias Uddin Ahmed v. Union of India, (2026) 45 Centax 152 (Gau.), W.P.(C) No. 2540 of 2025.
