The Andhra Pradesh High Court has reiterated an important procedural principle under the Goods and Services Tax (GST) law: a single composite assessment order covering multiple tax periods cannot be sustained when the law requires proceedings to be undertaken separately for the respective tax periods.
The ruling was delivered in M/s. G M R A Shaha Iron Steels vs. The Assistant Commissioner, State Tax, where the taxpayer challenged a consolidated assessment order passed under Section 74 of the GST Act for multiple financial years.
Background of the Case
The petitioner, M/s. G M R A Shaha Iron Steels, was subjected to GST proceedings covering several tax periods, including FY 2020-21 to FY 2023-24. Instead of passing separate orders for the respective assessment years, the GST authorities issued a common assessment order covering multiple periods.
Aggrieved by the composite assessment, the taxpayer approached the Andhra Pradesh High Court, contending that such a consolidated approach was contrary to the statutory scheme of the GST law.
The taxpayer relied upon the earlier decision of the Andhra Pradesh High Court in S.J. Constructions v. Assistant Commissioner & Others. In that decision, the Court had held that a single show cause notice or composite assessment order cannot ordinarily cover multiple tax periods in circumstances where separate proceedings are contemplated under the GST framework.
High Court’s Decision
The Division Bench comprising Justice Ninala Jayasurya and Justice T.C.D. Sekhar accepted the petitioner’s contention.
The Court referred to its earlier ruling in S.J. Constructions, which had laid down the principle that proceedings relating to different tax periods cannot simply be clubbed together into one assessment order where the statutory scheme requires period-wise determination.
Importantly, the Revenue did not raise any specific objection to the taxpayer’s contention regarding the composite assessment order.
Consequently, the High Court quashed the assessment order dated 27 May 2025.
However, the Court did not permanently prevent the GST authorities from taking action. It specifically permitted the authorities to initiate fresh proceedings separately for each assessment year in accordance with law.
Condition for Relief
While granting relief, the High Court imposed a condition upon the petitioner.
The taxpayer was directed to deposit 20% of the disputed tax amount within six weeks from receipt of the order. Any amount already deposited after the original assessment order was to be taken into account while calculating the required 20% deposit.
Thus, the Court balanced the procedural relief granted to the taxpayer with the interests of the Revenue.
Key Takeaway for GST Taxpayers
The judgment is significant for businesses facing GST proceedings covering multiple financial years.
A composite GST assessment order covering several tax periods may be vulnerable to challenge where the statutory framework requires separate determination for each relevant period. Taxpayers receiving consolidated GST notices or assessment orders should therefore carefully examine whether the proceedings have been conducted in accordance with the prescribed period-wise procedure.
At the same time, the judgment does not mean that the taxpayer is permanently relieved from the underlying tax proceedings. The GST authorities have been given liberty to initiate fresh proceedings separately for each assessment year.
Therefore, taxpayers should distinguish between a procedural defect in the assessment order and the substantive tax liability itself.
Conclusion
The Andhra Pradesh High Court’s decision reinforces the importance of following the statutory procedure while conducting GST assessment proceedings. Authorities cannot necessarily combine multiple tax periods into a single composite assessment merely for administrative convenience when the GST framework requires separate proceedings.
For taxpayers, the ruling highlights the importance of examining the jurisdiction, period covered, show cause notice, assessment procedure and statutory compliance whenever a GST order is issued.
Case Details
Case: M/s. G M R A Shaha Iron Steels vs. The Assistant Commissioner, State Tax
Case No.: Writ Petition No. 22817 of 2026
Court: Andhra Pradesh High Court
Date of Order: 13 August 2026
Provision Involved: Section 74 of the GST Act
Bench: Justice Ninala Jayasurya and Justice T.C.D. Sekhar
Counsel for Petitioner: P. VASU Sekhar