SCN Demanded IGST, But Final Order Imposes CGST & SGST with Penalty: Allahabad HC Finds Order wholly Contrary to Original SCN [Read Order]

The Allahabad High Court stayed the operation of a final GST adjudication order that imposed Central and State GST (CGST and SGST) demands along with penalties, despite the original Show Cause Notice ( SCN ) raising demand only for Integrated GST ( IGST ).

The Court observed that the impugned order appears to be contrary to the original SCN and may be without jurisdiction.

It was argued on behalf of the petitioner that the original SCN, dated prior to 30.11.2024, had proposed a demand of ₹2.98 crore towards IGST along with interest and penalty. There was no mention of CGST or SGST in that notice.

The petitioner duly responded to the SCN. However, after the expiry of the limitation period, a fresh notice was issued on 18.12.2024, in which the department revised the IGST demand and, for the first time, included a proposed demand of CGST and SGST of ₹19,777 each.

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Despite this, the final adjudication order, dated 20.02.2025, did not uphold any IGST demand but instead imposed a higher demand of ₹2.76 crore each for CGST and SGST, along with interest and penalty.

The petitioner contended that this was not only beyond the scope of the original SCN but also hit by limitation, rendering the final order without jurisdiction and unsustainable in law.

The Court stated that the matter "requires consideration" and directed the State to file a counter affidavit within six weeks, with liberty to the petitioner to file a rejoinder within two weeks thereafter. Meanwhile, the Court ordered that the effect and operation of the impugned adjudication order dated 20.02.2025 shall be stayed until the next date of listing.

The matter came up before the Division Bench comprising the Justices Sandeep Jain and S.D. Singh who heard submissions from the petitioner’s counsel Mr. Utkarsh Srivastava, assisted by Mr. Prem Narayan Singh, Ms. Surabhi Bhaskar, and Mr. Sisir Kumar Dash. The State was represented by Mr. Ravi Shankar Pandey.

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