Andhra Pradesh High Court quashes composite GST order for two tax periods in Kanaka Reddy Seerapu Vs Union of India

Background and context

The Andhra Pradesh High Court, in Kanaka Reddy Seerapu Vs Union of India (Writ Petition No: 21576 of 2026, judgment dated 14/08/2026), examined the validity of a single composite assessment order issued under Section 74 of the Central Goods and Services Tax Act (“CGST Act”) covering more than one tax period, namely 2019-20 and 2020-21.

The assessee, a registered firm, approached the High Court challenging a composite order dated 03.02.2026 passed by the 2nd respondent under Section 74 of the CGST Act. The core grievance was that the authority had combined multiple tax periods into one assessment order, which, according to the assessee, was contrary to the scheme and provisions of the CGST law.

With the consent of both sides, the Court decided to dispose of the writ petition at the admission stage itself.

Facts leading to the writ petition

Composite order under Section 74

  • The assessee, being a registered firm under the GST regime, was served with a composite order dated 03.02.2026 issued under Section 74 of the CGST Act.
  • This order covered the tax periods 2019-20 and 2020-21 together in a single composite proceeding.
  • Aggrieved by this approach, the assessee filed the present writ petition before the Andhra Pradesh High Court, contending that the issuance of such a composite order for multiple tax periods is not legally sustainable under the CGST framework.

Grounds of challenge

The learned counsel for the assessee, referring to the pleadings in the writ affidavit, effectively raised the following contentions:

  1. Illegality of composite assessment for multiple periods
    It was argued that the impugned order, which clubbed the tax periods 2019-20 and 2020-21 into a single composite order under Section 74, is impermissible in law.
    The counsel submitted that the CGST Act contemplates tax and assessment period-wise and not through a consolidated order spanning more than one tax period in the manner done in this case.

  2. Reliance on co-ordinate Bench decision
    Strong reliance was placed on a prior judgment of a co-ordinate Bench of the same High Court in S.J. Constructions v. The Assistant Commissioner & Others (W.P No.11028 of 2025 & batch), dated 17.09.2025.
    In that decision, the High Court had examined whether a single show cause notice or a composite assessment order could validly encompass more than one tax period and had laid down important principles on this issue.

Key extract from S.J. Constructions decision relied upon

The assessee drew the Court’s attention to the following passage from the decision in S.J. Constructions v. The Assistant Commissioner & Others (W.P No.11028 of 2025 & batch), dated 17.09.2025, which was reproduced and relied on in the present case:

“17. Section 74(3) is in parimateria with Section 73(3). However, sub- section (4) of Section 74 does not contain the term “such tax period”. This non mention would not, in our opinion, make any difference to the aforesaid interpretation. Apart from this, there are certain other provisions, which would also have to be considered. Any interpretation of an Act should not result in some of the other provisions becoming otiose or reduced in scope. As rightly pointed out by the Hon'ble High Court at Madras, the right of a registered person to obtain benefit under Section 128 of APGST Act as well as the right to invoke the remedy of appeal against the orders of assessment either under Section 73 or under Section 74 would get impacted if a common order is permitted to be issued in relation to more than one assessment / financial year.

18.