Typographical Error in the SCN Cannot Be a Shield for the Assessee Who Participated in the Proceedings Without Raising Any Objection

The Gujarat High Court has ruled that a typographical error in a Show Cause Notice (SCN) cannot be used to challenge penalties if the assessee actively participated in the proceedings without raising the issue. In this case, the assessee was accused of fraudulently claiming Input Tax Credit (ITC). Despite a minor error in the year of relied-upon documents mentioned in the SCN, the court found the assessee was aware of the actual period and had filed replies and attended hearings. The court emphasised that such objections must be raised promptly during adjudication, not as an afterthought in writ proceedings, especially when an alternative appeal route exists.

The Hon'ble Gujarat High Court in the case of M/s Shivani Enterprise Proprietor Vibhor Shivkumar Vaid v. Union of India & Ors. [R/Special Civil Application No. 1251 of 2026 dated June 18, 2026] dismissed the writ petition challenging the Show Cause Notice and the consequent Order-in-Original imposing penalties for alleged fraudulent availment of Input Tax Credit ("ITC") from a non-existent supplier, thereby holding that a typographical error in the Show Cause Notice in mentioning the year of the Relied Upon Documents cannot be a ground to quash the proceedings, when the assessee was well aware that the said documents pertained to the actual period of investigation and had actively participated in the adjudication proceedings, filed replies and attended personal hearings without ever raising any such grievance.

Facts:

M/s Shivani Enterprise Proprietor Vibhor Shivkumar Vaid ("the Petitioner") is engaged in the business of trading of scrap. Upon receipt of intelligence from the Central Goods and Services Tax authorities, Vadodara, regarding fraudulent availment of ITC by the Petitioner from M/s Ganpati Enterprises, a non-existent supplier, a physical verification of the declared premises of the Petitioner was conducted on December 09, 2020 under Section 67(1) of the Central Goods and Services Tax Act, 2017 ("the CGST Act") and a panchnama of even date was drawn, wherein it was revealed that the principal place of business was merely an open space lacking any infrastructure.

Thereafter, a Show Cause Notice dated February 29, 2024 in Form GST DRC-01 ("the Impugned SCN") was issued to the Petitioner proposing imposition of penalties under Section 122(1)(vii), (xii), (xvi) and (xvii) of the CGST Act. The Petitioner filed a reply and was also granted an opportunity of personal hearing. Subsequently, the Order-in-Original dated August 30, 2025 ("the Impugned Order") along with summary in Form GST DRC-07 dated September 11, 2025 was served on the common portal of the Petitioner.

The Petitioner filed a writ petition before the Hon'ble Gujarat High Court, inter alia , contending that only three pages of the Impugned SCN were supplied; that out of the six Relied Upon Documents ("RUDs") mentioned at Table-5 of the Impugned SCN, the RUDs at Sr. Nos. 4 to 6 pertaining to the period October 2021 to December 2021 were never furnished despite a specific request vide letter dated April 09, 2024, thereby violating the principles of natural justice. It was further contended that since the GST registration of the Petitioner was cancelled with effect from October 08, 2020 vide order dated January 16, 2021, there could not arise any question of RUDs of a subsequent period being relied upon in the Impugned SCN, and since the period in question was not specified, the Impugned SCN and the Impugned Order were liable to be quashed.

On the contrary, the Revenue contended that the writ petition was not maintainable as the Petitioner had an alternative statutory remedy of appeal under Section 107 of the CGST Act; that the Impugned SCN was supplied by e-mail and a complete physical copy thereof was also duly dispatched to the declared address of the Petitioner; that the Petitioner participated in the proceedings and never raised the grievance of receipt of only three pages of the Impugned SCN in any reply or personal hearing; that the reference to the year 2021 in the list of RUDs was merely an inadvertent typographical error, whereas the period of investigation and the consequent demand actually related to October 2018 to November 2019, spanning the Financial Years 2018-19 and 2019-20, of which the Petitioner was evidently aware; and that the RUDs, being the GST returns and e-way bills of the said period, were already available with the Petitioner and were extensively dealt with in the Impugned Order.

Issue:

Whether the Show Cause Notice and the Order-in-Original imposing penalties for fraudulent availment of ITC are liable to be quashed on the ground of alleged non-supply of the RUDs and a typographical error in mentioning the year of the RUDs, when the assessee actively participated in the adjudication proceedings without raising any such objection?

Held:

The Hon'ble Gujarat High Court in R/Special Civil Application No. 1251 of 2026 held as under:

Observed that, the Petitioner has an alternative efficacious remedy of filing an appeal under Section 107 of the CGST Act, which is not denied; however, since the Petitioner invited an order on merits, the Court proceeded to examine the matter.

Noted that, after issuance of the Impugned SCN, the Petitioner was personally heard by the Department and had also filed replies during the course of the proceedings, and in none of the replies did the Petitioner allege that only three pages of the Impugned SCN were received. The said allegation was categorically denied by the Revenue in its affidavit-in-reply asserting that a complete physical copy of the Impugned SCN was duly dispatched to the declared address of the Petitioner. Such disputed factual issues fall within the domain of appreciation of facts, which can be undertaken by the Appellate Authority.

Noted that, the mention of the year 2021 in the list of RUDs in the Impugned SCN was an inadvertent typographical error, whereas the period of investigation and the subsequent demand related to October 2018 to November 2019, spanning the Financial Years 2018-19 and 2019-20, and the RUDs, being GSTR-3B, GSTR-2B, GSTR-1M and e-way bills for the said period, were already available with the Petitioner, were duly scrutinized and form part of the Impugned Order.

Observed that, the Petitioner, as an afterthought and after having participated in the proceedings, was trying to build a case on the typographical error by contending that since his registration was cancelled with effect from October 08, 2020, the RUDs of the period October 2021 to December 2021 were incorrectly relied upon, whereas the Petitioner was well aware during the proceedings that the said RUDs pertained to the period prior to the cancellation of his registration.

Held that, the Petitioner was offered sufficient opportunity of hearing by the Adjudicating Authority and there was no violation of the principles of natural justice or any statutory provision. The Appellate Authority is competent to examine the facts and issues raised in the writ petition. Accordingly, the Court declined to exercise its extraordinary jurisdiction under Article 226 of the Constitution of India and rejected the writ petition.

Our Comments:

Section 122(1) of the CGST Act enumerates the offences which attract penalty under the GST law. Clause (vii) thereof covers a person who takes or utilises ITC without actual receipt of goods or services or both, either fully or partially, in contravention of the provisions of the CGST Act or the rules made thereunder, while clauses (xii), (xvi) and (xvii), inter alia , cover furnishing of false information, failure to keep and maintain books of account and documents, and failure to furnish information or documents called for by an officer or furnishing false information or documents during any proceedings. Further, Section 107 of the CGST Act provides an efficacious statutory remedy of appeal to the Appellate Authority against any decision or order passed by an adjudicating authority.

The present ruling reiterates the settled position that the extraordinary writ jurisdiction under Article 226 of the Constitution of India is not to be exercised when an efficacious alternative remedy is available, save in exceptional circumstances. The Hon'ble Supreme Court in Assistant Commissioner of State Tax v. Commercial Steel Ltd. [Civil Appeal No. 5121 of 2021 dated September 03, 2021] held that a writ petition against an order under the GST law can be entertained only in exceptional situations such as breach of fundamental rights, violation of the principles of natural justice, excess of jurisdiction, or a challenge to the vires of the statute. Similarly, in Radha Krishan Industries v. State of Himachal Pradesh [Civil Appeal No. 1155 of 2021 dated April 20, 2021] , the Hon'ble Supreme Court culled out the principles governing the exercise of writ jurisdiction where a statutory alternative remedy exists.

Equally significant is the Court's approach on the plea of violation of natural justice. The Hon'ble Supreme Court in State of U.P. v. Sudhir Kumar Singh [Civil Appeal No. 3498 of 2020 dated October 16, 2020] laid down that a breach of natural justice must be tested on the touchstone of real prejudice, and that natural justice cannot be reduced to a mere mantra to be invoked mechanically. Applying the same reasoning, the Hon'ble Gujarat High Court found that the assessee, who possessed the relevant GST returns and e-way bills of the actual period of investigation and had contested the proceedings on merits, suffered no prejudice on account of a mere clerical slip in mentioning the year of the RUDs. Conduct of the assessee is thus a decisive factor – an objection regarding incomplete service of the notice or non-supply of documents, raised for the first time in writ proceedings after full participation in adjudication, is liable to be treated as an afterthought.

At the same time, it is pertinent to note that where the non-supply of relied upon documents genuinely disables the noticee from putting forth an effective defence, Courts have consistently held such non-supply to be fatal to the proceedings. The Hon'ble Supreme Court in Kothari Filaments v. Commissioner of Customs (Port), Kolkata [(2009) 2 SCC 192] held that an order passed in reliance upon documents not supplied to the noticee violates the principles of natural justice, and in T. Takano v. Securities and Exchange Board of India [Civil Appeal No. 487-488 of 2022 dated February 18, 2022] , it was held that disclosure of material relevant to the proceedings is a component of a reasonable opportunity of being heard. The dividing line, therefore, lies in demonstrable prejudice – a taxpayer who is genuinely denied the RUDs must promptly and specifically raise the grievance before the adjudicating authority itself, for silence during adjudication followed by a belated challenge in writ jurisdiction is unlikely to find favour with the Courts.

This decision serves as a cautionary precedent for taxpayers to diligently raise all procedural objections, including those relating to service of notice and supply of RUDs, at the earliest stage of adjudication, and to pursue the statutory appellate remedy under Section 107 of the CGST Act for factual disputes, rather than invoking the writ jurisdiction of the High Court.

Relevant Provisions:

Section 122(1)(vii) of the CGST Act:

"122. Penalty for certain offences. -

(1) Where a taxable person who– …

(vii) takes or utilises input tax credit without actual receipt of goods or services or both either fully or partially, in contravention of the provisions of this Act or the rules made thereunder; …"

Section 107(1) of the CGST Act:

"107. Appeals to Appellate Authority. -

(1) Any person aggrieved by any decision or order passed under this Act or the State Goods and Services Tax Act or the Union Territory Goods and Services Tax Act by an adjudicating authority may appeal to such Appellate Authority as may be prescribed within three months from the date on which the said decision or order is communicated to such person."

OFFICIAL JUDGMENT COPY HAS BEEN ATTACHED