Delhi High Court Declines Writ Against GST SCN Corrigendum Allegedly Expanding Tax Period, Cites Appeal Remedy

The Delhi High Court has recently declined to entertain a challenge to a corrigendum allegedly expanding the scope of a show cause notice by including an additional financial year, holding that such issues require factual examination and are not suited for adjudication under Article 226 when an efficacious statutory remedy is available.

A Division Bench of Justices Nitin Wasudeo Sambre and Ajay Digpaul dismissed a writ petition filed by Manpar Icon Technologies challenging a show cause notice issued under Section 74 of the Central Goods and Services Tax Act, 2017, along with a subsequent corrigendum and the order-in-original confirming a tax demand of over Rs 42 lakh.

The petitioner contended that the corrigendum impermissibly expanded the scope of the original show cause notice by adding Financial Year 2019–20, whereas the initial notice pertained only to Financial Year 2018–19.

It was argued that such an expansion amounted to initiation of fresh proceedings beyond the period of limitation and could not be justified as a mere rectification under Section 161 of the CGST Act.

Opposing the plea, the Revenue submitted that the corrigendum only corrected a typographical error regarding the relevant tax period and did not introduce any new transaction or liability. It was further argued that the petitioner had an efficacious alternate remedy by way of appeal under Section 107 of the Act.

The High Court declined to examine the merits of the petitioner's challenge, observing that determination of whether the corrigendum amounted to a permissible correction or an impermissible expansion would require examination of facts and material on record—an exercise not appropriate in writ jurisdiction.

“Having noted the statutory power to issue a corrigendum, the contention of the petitioner that the corrigendum is bad in law would require an examination of the nature of the correction and the material on record. Such an exercise would involve the appreciation of facts and is not to be undertaken in proceedings under Article 226, particularly within the limited scope of certiorari jurisdiction,” it said.

The court further noted that the statute provides for an appellate remedy.

“In such circumstances, mere disagreement with the conclusions drawn by the adjudicating authority would not, by itself, be a ground to bypass the statutory remedy and invoke the writ jurisdiction of this Court,” it said.

The court added that an efficacious alternative remedy is available to the petitioner by way of an appeal under Section 107 of the CGST Act read with Rule 109A of the CGST Rules.

“Section 107 expressly provides an appellate remedy to any person aggrieved by an order passed by the adjudicating authority, and such remedy constitutes the ordinary statutory recourse against an order passed under Section 74 of the CGST Act. We, therefore, find no cause to interfere with the impugned order,” the court said.

The court clarified that it has not examined or expressed any opinion on the merits of the case and dismissed the writ petition.

For Petitioner: Advocates Chinmaya Seth, Advocates A.K. Seth, and Palak Mathur,

For Respondent: SSC Monica Benjamin with Advocate Nancy Jain