The Allahabad High Court has quashed a show cause notice issued under Section 74 of the State Goods and Services Tax/Central Goods and Services Tax Act, 2017, after finding that the notice failed to contain the essential ingredients necessary for invoking the provision, including allegations relating to fraud, wilful misstatement or suppression of material facts with an intent to evade tax.

The Bench of Justice Shekhar B. Saraf and Justice Abdhesh Kumar Chaudhary  the show cause notice issued under Section 74 did not contain the required ingredients “in relation to any fraud, wilful misstatement or suppression of material facts with the intent to evade tax.”

The petitioner/assessee had approached the High Court under Article 226 of the Constitution of India challenging a show cause notice dated May 4, 2026, issued by the respondent authority under Section 74 of the SGST/CGST Act for the tax period 2020-21.

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The petitioner sought issuance of a writ of certiorari for quashing the impugned notice, principally contending that it suffered from a patent lack of jurisdiction and was otherwise without jurisdiction.

The central issue before the High Court was whether proceedings under Section 74 of the GST law could be initiated through a show cause notice that did not contain allegations satisfying the statutory ingredients associated with fraud, wilful misstatement or suppression of facts with an intent to evade tax.

Upon examining the impugned show cause notice, the Division Bench found that the notice did not contain the ingredients required for invoking Section 74.

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