M/s True and Co. (Firm) filed its GST return for the month of January 2026 and in the said return, tax was short paid inadvertently due to a mistake…

CA Final · Indirect Tax Laws · MTP · November 2026
M/s True and Co. (Firm) filed its GST return for the month of January 2026 and in the said return, tax was short paid inadvertently due to a mistake committed in filing the return. Due date for filing of annual return for the financial year 2025-26 is 31.12.2026. The firm asks your opinion with brief legal provisions on the following issues: (i) What is the latest date by which show cause notice (SCN) under section 74A can be issued by the proper officer in the above situation? (ii) What is the timeline to pass order for the above said SCN? (iii) What would be your answer for point (i) and (ii) in case the reason of short payment was as a result of wilful-misstatement? Assume that no extension of time will be provided by the appropriate authority for passing the order in the above situation.

Suggested Answer and Working Notes:

(i) The proper officer can issue a show cause notice within 42 months from the due date of furnishing the annual return (31.12.2026) for relevant financial year to which short payment relates to, i.e. upto 30.06.2030 in the given case. (ii) The time-limit to pass the order for the above SCN is upto 12 months from the date of issuance of said SCN. This can be extended by a maximum 6 months is special circumstances (iii) Answers to (i) and (ii) above will remain same in case the reason of the short-payment was a result of willful mis-statement.

Topics: Demands and Recovery

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