Delhi HC: File One Appeal for Common GST SCN Covering Multiple Years

In a key decision, the Delhi High Court has clarified that if a taxpayer receives a single GST Show Cause Notice (SCN) covering multiple years, they need to file just one consolidated appeal—not separate appeals for each year. This ruling came from a case involving M/s Delhi Foils, and it aims to simplify the GST appeal process under Section 107 of the CGST Act, 2017.

Case Summary

🧑‍⚖️ Petitioner: M/s Delhi Foils (a partnership between Mr. Alok Bhargava and Ms. Neena Bhargava)
🏢 Respondent: Directorate General of GST Intelligence (DGGI), Gurugram

• A search was conducted at the firm’s premises on 29 December 2020.

• Both partners were arrested on 30 December 2020 for alleged fake ITC claims using invoices without actual goods.

• A common SCN was issued on 31 August 2022, covering 3 financial years (2017–18, 2018–19, and 2019–20).

• The firm responded, but a tax demand order followed on 3 February 2025.

  
  

Dispute on Filing Appeal

• The firm filed three separate appeals, one for each year.

• However, the GST Department clarified that the Form DRC-07 (dated 5 February 2025) was meant to cover all three years—even though it mentioned only FY 2017–18 (for limitation purposes).

• This created confusion over whether multiple appeals were required.

  
  

 What the Delhi HC Said

The High Court clearly stated:

✅ One SCN + One Order = One Appeal
Since the show cause notice and adjudication covered multiple years in one go, filing multiple appeals made no sense.

✅ Avoid Legal Confusion
Separate appeals could lead to double proceedings and even conflicting decisions.

✅ Limitation Period Reference Is Just a Form Requirement
Mentioning only FY 2017–18 in DRC-07 was procedural—it doesn’t limit the scope of tax demand for other years.

Why This Matters: Legal Impact

This decision is important for all GST professionals and businesses:

• ✅ Clear Process: File one consolidated appeal for a common SCN.

• ✅ Lower Costs: Avoid time and money spent on multiple cases.

• ✅ Cleaner Documentation: Helps both taxpayers and authorities handle GST disputes more efficiently.

  
  

What Businesses Should Do

✔️ Read SCNs Carefully – Check if one SCN covers multiple financial years.
✔️ File a Single Appeal – Don’t split up appeals unless notices are separate.
✔️ Check the Time Limit – Even if the notice mentions only the first year, later years might still be covered.
✔️ Get Legal Advice – Always consult your CA or GST expert before filing appeals.

❓FAQs

Q1. What is a Show Cause Notice (SCN) in GST?
A Show Cause Notice is a legal notice issued by tax authorities asking the taxpayer to explain why action should not be taken against them for non-compliance.

Q2. Can I file separate appeals if one SCN covers multiple years?
No. As per the Delhi High Court, if there's one common SCN and one order, you should file one consolidated appeal.

Q3. What is Form DRC-07?
It’s the summary of an adjudication order showing the amount of tax demand. Even if it mentions only one year, it can legally cover multiple years.

Q4. Why is the reference year in DRC-07 important?
It helps meet the limitation period, but does not limit the scope of the order.

Q5. What happens if I file multiple appeals by mistake?
Your appeals may be rejected or delayed. It’s always better to file a single appeal if the order arises from a common SCN.

Conclusion

The Delhi High Court’s ruling offers much-needed clarity for taxpayers dealing with GST disputes. Filing a single appeal for a single SCN covering multiple years saves time, effort, and legal confusion. Businesses and tax professionals should align their compliance and legal strategies with this guidance to ensure smooth resolution of disputes and avoid unnecessary litigation.