The Andhra Pradesh High Court recently quashed composite GST assessment orders that covered multiple financial years, ruling that such orders are contrary to GST provisions. The case involved S J Constructions and others challenging assessment orders that combined several years into a single order. The petitioners argued that these orders lacked proper signatures and Document Identification Numbers (DIN), and contravened GST law by not issuing separate notices for each financial year.
The court examined conflicting precedents from various High Courts. While the Madras, Karnataka, and Kerala High Courts had previously disallowed composite orders, the Delhi and Bombay High Courts had upheld them. Ultimately, the Andhra Pradesh High Court sided with the Madras High Court's rulings, emphasizing that GST law mandates separate notices and orders for each tax period. The court noted that composite orders could undermine statutory remedies such as appeals, limitations, and settlements.
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As a result, the court set aside all the impugned composite assessment orders and directed the authorities to initiate fresh proceedings on a year-wise basis. Furthermore, the court instructed that the limitation period should exclude the time during which the original orders were contested. This decision underscores the importance of adhering to procedural requirements in tax assessments to preserve taxpayers' rights and remedies.
Order date:17 Sept 2025
Parties: S J Constructions & Ors. v. Assistant Commissioner & Ors.
Facts -
- The Petitioners challenged GST assessment orders that clubbed multiple financial years in one order.
- Defects raised: lack of signature/DIN, and bunching of multiple years contrary to GST provisions.
- Conflicting precedents existed in Madras, Karnataka, Kerala HCs disallowing composite orders; Delhi and Bombay HCs upholding them.
Issue -
- Whether a composite show cause notice or assessment order covering multiple financial years is valid under GST law?
Order -
- The Divisional bench of the Hon’ble high court agreed with Madras HC rulings (Titan Co. Ltd., RA & Co.) that GST law requires separate notices/orders for each tax period.
- It also held that Composite orders undermine statutory remedies (appeals, limitation, settlement) and all impugned composite assessment orders were set aside.
- Authorities directed to issue fresh proceedings year-wise. Limitation to be computed excluding the period during which the impugned orders remained under challenge.
