GST Judiciary Issue Cannot Be Reopened if Previously Decided


GST Judiciary Issue Cannot Be Reopened if Previously Decided


Here is an important judgement by Madras High Court on GST Judiciary Issue in the case of Jayanthi Plastics (Defunct) v. Deputy State Tax Officer-2.

In the said judgment, the Madras High Court addressed an important issue regarding the reopening of GST assessments. In this case, the Court ruled that once an issue has been decided in an earlier adjudication order, it cannot be reopened by the tax department for the same assessment period.

The petitioner, engaged in the plastic products business, challenged a show cause notice (SCN) issued by the department, which sought explanation for differences in output tax liability between GSTR-1 and GSTR-3B returns. The petitioner argued that this issue had already been adjudicated in a previous order.

Upon examination, the High Court confirmed that both the earlier order and the impugned SCN pertained to the assessment period 2018-19, and the first issue raised in the SCN was identical to the one resolved in the earlier order. Consequently, the department was not permitted to reopen the same issue.

The Court directed the petitioner to respond to the SCN only regarding issues of under-declaration of ineligible Input Tax Credit (ITC) and invalid ITC under Section 16(4) of the GST Act. However, it set aside the SCN concerning the reconciliation of GSTR-1 and GSTR-3B, affirming that all arguments remained open to the petitioner.

This judgment reinforces the principle of finality in tax assessments and underscores the importance of adhering to legal precedents. It provides clarity on the scope of reopening assessments under GST laws, offering guidance to taxpayers and tax authorities alike.

The copy of the circular is as under: