Judicial Corner: Extended limitation under sec. 74 justified as non-response to DRC-01A and DRC-01 construed as suppression{ [2026] 187 taxmann.com 1105 (Madras)} Facts The department issued DRC-01A intimations and DRC-01 show cause notices for FY 2018-19 and 2019-20 after scrutiny. Petitioner did not submit any reply or provide the requested information. Consequently, the department passed ex parte orders under Section 74 alleging suppression and invoking the extended limitation period. Petitioner challenged these orders before the High Court. Issue Whether proceedings under Section 74 of the CGST Act could be initiated by invoking the extended limitation period on the ground of “suppression” when the taxpayer failed to respond to DRC-01A intimations and DRC-01 show cause notices. Held The High Court of Madras held that the petitioner’s failure to respond to DRC-01A intimations and DRC-01 show cause notices amounted to suppression, thereby justifying the invocation of Section 74 and the extended limitation period. The Court observed that the ex parte orders were valid since the petitioner failed to participate in the proceedings. However, in the interest of natural justice, the Court set aside the orders and remanded the matter for fresh (de novo) adjudication, allowing the petitioner an opportunity to file a proper reply. The Court also clarified that if Section 74 had been wrongly invoked, the Appellate Authority could treat the proceedings under Section 73, provided a proper reply to the DRC-01 notice was on record. (07.07.2026)
Extended limitation under sec. 74 justified as non-response to DRC-01A and DRC-01 construed as suppression{ [2026] 187 taxmann.com 1105 (Madras)} Facts The department issued DRC-01A intimations and DRC-01 show cause notices for FY 2018-19 and 2019-20 after scrutiny. Petitioner did not submit any reply or provide the requested information. Consequently, the department passed ex parte …
