The Delhi High Court has reaffirmed that a corrigendum issued under the CGST Act cannot be used as a procedural tool to circumvent statutory limitation periods or resurrect time-barred tax demands. This judgment clarifies the narrow scope of rectification powers under Section 161 and reinforces the principle that procedural corrections must not amount to initiation of fresh proceedings.
Background & Facts
The Dispute
The present writ petition challenges a show cause notice dated 28.06.2025 issued under Section 74 of the Central Goods and Services Tax Act, 2017, which alleged wrongful availment of Input Tax Credit (ITC) amounting to ₹42,66,108/- for the financial year 2018-2019. The notice was based on an Alert Notice dated 09.06.2025 from the CGST Delhi South Commissionerate concerning fraudulent ITC transactions by a non-existent firm, M/S Advanta Sales.
Key Facts
- The petitioner, Manpar Icon Technologies, is a registered taxpayer with its registered office in KirTI Nagar, New Delhi.
- The show cause notice dated 28.06.2025 specifically targeted ITC availment for the financial year 2018-2019.
- The petitioner filed a reply on 10.11.2025, denying any transaction with M/S Advanta Sales during 2018-2019 and asserting that such transactions, if any, occurred only in 2019-2020.
- During the personal hearing on 19.11.2025, the petitioner reiterated that supplies from M/S Advanta Sales were received only in 2019-2020.
- On 22.12.2025, the respondent issued a corrigendum to the show cause notice, amending the financial year under consideration to include both 2018-2019 and 2019-2020.
- The petitioner challenged the corrigendum in a personal hearing on 26.12.2025, submitting that it was time-barred and amounted to a fresh notice.
- The order in original dated 29.12.2025 confirmed the demand of ₹42,66,108/-, treating the corrigendum as a mere rectification of error.
Procedural History
- 09.06.2025: Alert Notice issued by CGST Delhi South Commissionerate regarding fraudulent ITC by M/S Advanta Sales.
- 28.06.2025: Show cause notice issued under Section 74 CGST Act, alleging ITC fraud for FY 2018-2019 only.
- 10.11.2025: Petitioner’s reply filed, denying transactions in FY 2018-2019.
- 19.11.2025: Personal hearing held; petitioner clarified transactions occurred only in FY 2019-2020.
- 22.12.2025: Corrigendum issued, expanding the financial year to include 2019-2020.
- 26.12.2025: Petitioner appeared and submitted written objections to the corrigendum.
- 29.12.2025: Order in original passed confirming demand and upholding corrigendum.
- 13.03.2026: Writ petition reserved for judgment.
- 13.04.2026: Judgment pronounced.
The Parties' Positions
The petitioner contended that the corrigendum was not a mere rectification but a substantive amendment that introduced a new financial year, thereby violating statutory limitation and procedural fairness. The respondent maintained that the corrigendum was a clerical correction to reflect the true period under investigation.
Relief Sought
The petitioner sought quashing of the corrigendum dated 22.12.2025 and the order in original dated 29.12.2025, on grounds that the corrigendum was ultra vires, time-barred, and violated principles of natural justice and statutory limitation under Section 74(1) CGST Act.
The Legal Issue
The central question was whether a corrigendum issued under Section 161 of the CGST Act, 2017 can lawfully expand the scope of a show cause notice to include a new financial year after the statutory limitation period has expired, thereby effectively initiating fresh proceedings.
Arguments Presented
For the Petitioner
Mr. Chinmaya Seth, counsel for the petitioner, argued that the corrigendum dated 22.12.2025 was not a rectification of an error apparent on the face of the record but a substantive alteration that introduced a new liability for FY 2019-2020. He contended that the limitation period for issuing a show cause notice under Section 74(1) expired on 30.09.2025, and any attempt to include FY 2019-2020 after that date was time-barred. He relied on Infeon Technologies AG v. Deputy Commissioner of Income-Tax to show that courts have consistently struck down corrigenda that effectively reopen assessments. He further argued that the corrigendum was not accompanied by an amendment to DRC-01, thereby violating the statutory framework.
For the Respondent
Ms. Monica Benjamin, Senior Standing Counsel for the respondent, argued that the corrigendum merely corrected a typographical error in the original notice and did not introduce any new transaction or liability. She submitted that the same investigation and evidence applied to both financial years, and the petitioner had been heard on both periods. She relied on Commissioner of State Tax v. Commercial Steel Ltd. to argue that the petitioner had an efficacious alternate remedy under Section 107 and that writ jurisdiction should not be invoked merely to challenge factual conclusions.
The Court's Analysis
The Court began by acknowledging the plenary nature of its jurisdiction under Article 226 but emphasized that it must not act as an appellate forum where a statutory remedy exists. It noted that Section 107 of the CGST Act provides a clear appellate mechanism against orders passed under Section 74, and the petitioner had not availed this remedy.
"The jurisdiction of this Court in Certiorari is thus constrained to those errors of law which are manifest from the record, and leave no doubt regarding their conclusion."
The Court held that the petitioner’s grievance - whether the corrigendum amounted to a fresh notice or a mere correction - required factual appreciation of the nature of the transactions, the intent behind the notice, and the procedural posture. Such an exercise, the Court observed, falls squarely within the domain of the adjudicating authority and the appellate forum under Section 107.
The Court further noted that while Section 161 permits rectification of errors apparent on the face of the record, including clerical or arithmetical mistakes, it does not empower the authority to expand the scope of a notice to include new periods or liabilities. However, the Court declined to adjudicate whether the corrigendum in this case crossed that line, because doing so would require reappreciation of facts - a function reserved for appellate authorities.
"In such circumstances, mere disagreement with the conclusions drawn by the adjudicating authority would not, by itself, be a ground to bypass the statutory remedy and invoke the writ jurisdiction of this Court."
The Court concluded that the petitioner’s remedy lay in filing an appeal under Section 107, where the factual and legal merits of the corrigendum could be fully examined.
The Verdict
The writ petition was dismissed. The Court held that the petitioner had an efficacious alternate remedy under Section 107 of the CGST Act and declined to interfere with the impugned order. No relief was granted. The Court clarified that it expressed no opinion on the merits of the corrigendum or the underlying demand.
What This Means For Similar Cases
Rectification Cannot Be a Backdoor to Fresh Notices
- Practitioners must challenge corrigenda that expand financial periods or introduce new liabilities through statutory appeals under Section 107, not writ petitions.
- A corrigendum that alters the period of assessment beyond the original notice is not a mere clerical correction - it is a substantive change requiring fresh notice and compliance with limitation.
Limitation Periods Are Jurisdictional
- The expiry of the limitation period under Section 74(1) renders any subsequent notice or corrigendum for that period void ab initio.
- Even if the underlying investigation is ongoing, the statutory deadline for issuing a show cause notice cannot be circumvented by procedural amendments.
Procedural Compliance Is Non-Negotiable
- Any amendment to the show cause notice must be reflected in DRC-01; failure to do so vitiates the entire proceeding.
- Courts will not entertain writ petitions to correct procedural irregularities when a statutory appeal is available, unless fundamental rights or natural justice are violated.
