Madras High Court Sets Aside GST Assessment Covering Multiple Years in Dream Infotech Case

The Madras High Court, in Dream Infotech Vs State Tax officer, has reaffirmed an important principle under GST law: authorities cannot lawfully issue a single show cause notice or assessment order by combining several financial years into one consolidated proceeding. Any such “clubbing” amounts to lack of jurisdiction and renders the proceedings invalid.

This ruling reinforces an earlier common order of the same Court dated 21.07.2025 and clarifies the procedural limits that GST authorities must respect while issuing show cause notices and passing assessment orders.

Background of the Writ Petition

Dream Infotech approached the Madras High Court under writ jurisdiction challenging:

  • An assessment order dated 29.10.2025, and
  • The show cause notice dated 02.07.2025,

both issued by the State Tax Officer under GST law.

Core Challenge

The assessee’s grievance centred on the fact that:

  • A single show cause notice was issued, and
  • A single assessment order was passed,

covering five distinct financial years:

  • 2019–20
  • 2020–21
  • 2021–22
  • 2022–23
  • 2023–24

The assessee argued that such clubbing of multiple years into one combined proceeding is expressly contrary to the scheme of the GST law and has already been held to be impermissible by the Madras High Court in an earlier batch of writ petitions decided on 21.07.2025.

Proceedings Before the High Court

Admission and Hearing

  1. The writ petition was taken up for hearing at the admission stage itself.
  2. The learned Additional Government Pleader, R.Suresh Kumar, accepted notice on behalf of the respondent.
  3. With consent of both sides, the Court proceeded to decide the matter finally at the admission stage.

Petitioner’s Contentions

The learned counsel for the assessee submitted that:

  • The sole legal issue in dispute is the “bunching” or “clubbing” of multiple financial years into one show cause notice and one assessment order.
  • The very same issue has already been conclusively determined by the Madras High Court in its common order dated 21.07.2025 in W.P.Nos.29716 of 2024, etc., batch.
  • In that earlier decision, the Court laid down a clear principle that, under the GST Act, a show cause notice must be anchored to a specific tax period, and multiple financial years cannot be clubbed in a single notice or order.

The relevant observations relied upon from the earlier common order (dated 21.07.2025) were specifically: