Authority: Supreme Court of India

Order Date: 19 August 2026

Case Overview

  • Parties: Appellant – M/s G.R. Infra Projects Limited Ratlam; Respondents – State of Madhya Pradesh & Others.
  • Nature of Proceeding: Civil Appeal No.11277 of 2026 arising from Special Leave Petition (C) No.33594 of 2025, challenging a Show Cause Notice (SCN) issued under Section 74 of the Central Goods and Services Tax Act, 2017 (CGST Act) for Assessment Year 2018‑19.
  • Key Dates:
  • SCN issued by the respondent department on 13‑June‑2025.
  • Original filing deadline for annual return for AY 2018‑19: 31‑Dec‑2019 (extended by notifications to 31‑Dec‑2020).
  • Limitation for issuing notice under Section 73 expired on 31‑Dec‑2023.
  • COVID‑19 related limitation exclusion (15‑Mar‑2020 to 28‑Feb‑2022) extended the limitation to 28‑Feb‑2025.
  • Summons issued on 03‑Mar‑202 (year not fully legible) covering business for FY 2017‑18 to 2020‑21.
  • Draft notice‑investigation report dated 03‑Mar‑2025; intimation under Section 142(1A) dated 29‑Apr‑2025.
  • Preliminary objections filed on 14‑May‑2025; draft notice served on 27‑May‑2025.
  • SCN under Section 74 finally issued on 13‑June‑2025.
  • Allegations: The SCN merely referenced “fraud or concealment of facts” without detailing any specific fraudulent act or suppressed information. The State’s counter‑affidavit attempted to elaborate fraud allegations, but the Court held that such details must be present in the notice itself.
  • Legal Reasoning:
  • Section 73 requires a notice to be issued within three years of the due date for filing the annual return; the extended deadline after COVID‑related exclusion placed the final permissible date on 28‑Feb‑2025.
  • The SCN dated 13‑June‑2025 therefore exceeded the statutory limitation.
  • Section 74 can be invoked only when fraud, willful misstatement, or concealment is expressly alleged in the notice; the SCN’s vague language failed this requirement.
  • The Court refused to consider the State’s counter‑affidavit as a substitute for a valid notice.

Final Outcome

  • The Supreme Court set aside the impugned order of the High Court, the SCN issued under Section 74, and directed the State of Madhya Pradesh to desist from any further proceedings based on the invalid SCN.
  • The Civil Appeal is allowed.
  • All pending applications, if any, are disposed of.

Topics: GST, Statutory Limitation