The Goods and Services Tax Appellate Tribunal (GSTAT) has admitted an appeal raising significant questions over the invocation of Section 74 of the Central Goods and Services Tax (CGST) Act, 2017 for multiple financial years through a single notice, besides an allegation that the taxpayer was denied a requested personal hearing before the First Appellate Authority.

The Bench of Tushsar Kanti Satapathy (Judicial Member) and Bijoy Bihari Mahapatra (Technical Member) found that the appellant had prima facie made out arguable grounds warranting consideration by the Tribunal. The order was passed on August 24, 2026.

The appeal challenged the proceedings principally on the ground that Section 74 had been incorrectly invoked for the period covering financial years 2017-18 to 2022-23. It was submitted that the necessary ingredients for initiating proceedings under Section 74 had not been complied with in the case.

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A further objection was raised against the issuance of a single notice covering several financial years. The appellant contended that financial years 2017-18 to 2022-23 had been clubbed together in one notice and argued that such clubbing was impermissible in law.

Emphasising the importance of a valid show-cause notice to tax proceedings, the appellant argued before the Tribunal that the notice constitutes the “first limb and fundamental requirement” of valid proceedings. According to the appellant, the statutory requirement contemplated under the CGST Act did not appear to have been fulfilled in the proceedings under challenge.

The appeal also raised a separate issue concerning compliance with the principles of natural justice. It was submitted that adequate and proper opportunity had not been provided while deciding the first appeal.

According to the appellant, a request for personal hearing had specifically been made in Form GST APL-01 before the First Appellate Authority. However, the request was allegedly ignored while disposing of the appeal. On this basis, the appellant contended that there had been a clear violation of the principles of natural justice and sought a decision in its favour.

On behalf of the Revenue, Assistant Commissioner Asren Nelken Jojo appeared before the Tribunal and supported the position adopted in the First Appellate Order.

After hearing the parties, the GSTAT examined the memorandum of appeal as well as the documents annexed to it. At the present stage, the Tribunal did not finally adjudicate whether clubbing multiple financial years in the notice was legally permissible or whether the conditions for invoking Section 74 had actually been satisfied.

Instead, the Bench recorded that the appellant had, prima facie, made out “arguable grounds” that warranted consideration by the Tribunal. Consequently, the GSTAT admitted the appeal and directed issuance of notice to the respondent.

The Tribunal was also informed that system-generated intimation was being sent to both parties. In view of the same, it held that issuance of a further notice to the respondent was unnecessary. The Revenue was granted liberty to file its cross-objection within 45 days.

The matter has now been directed to be listed for further hearing on December 17, 2026. 

Thus, the substantive questions raised by the appellant—including the validity of invoking Section 74 for the disputed period, the legality of clubbing financial years 2017-18 to 2022-23 in one notice, and the alleged denial of personal hearing—remain open for consideration at the subsequent stage of the proceedings.

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