The Allahabad High Court has held that two separate demand notices cannot be issued for a single order under GST.
The Bench of Justice Saumitra Dayal Singh and Justice Vivek Saran furnishes relief to Lava International Limited by allowing it to submit a single regulatory appeal against a GST adjudication order, while questioning the decision of the adjudicating authority to split the demand into multiple notices.
The issue has emerged after the tax authorities had issued two separate demand notices (DRC-07 forms) on December 16, 2025. One notice includes a tax demand of more than 26.64 crore along with an equal penalty, and another notice charged an additional penalty surpassing 3.64 crore. The same bifurcation pushes the applicant to submit two separate appeals and not one.
As per the company, the same splitting of demand from a single adjudication order was opposite to the regulatory structure under the law. The taxpayer must deposit 10% of the disputed tax amount to submit a plea, without any need to deposit amounts of the penalties at that phase. But from the issuance of two notices, the applicant has to make additional deposits to keep multiple appeals.
The court, considering the same, stated that the decision of the adjudicating authority to bifurcate the demand appeared prima facie unaccountable and formed an unnecessary obstacle in the appellate procedure.
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The Bench outlined that a single appeal ordinarily lies against an adjudication order that includes both tax and penalty components.
At the time of the hearing, the revenue’s counsel offered to withdraw the two demand notices and issue a fresh consolidated notice. The court, while considering this submission, allowed the authorities to issue a composite DRC-07 within 1 week. The limitation period to file the appeal shall start from the date of service of the fresh notice.
The court permitted the applicant to submit its appeal on depositing 10% of the disputed tax amount. It was thereafter directed that no coercive recovery measure must be opted for against the company in the pendency of the appeal in compliance with the deposit prerequisite.
Through such directions, the writ petition was disposed of, and the court abstained from making further observations on the conduct of the adjudicating authority, noting the assurance furnished via the revenue that the same procedural errors shall not be repeated in the future.
| Case Title | Lava International Limited vs. Union Of India |
| Case No. | WRIT TAX No. – 1576 of 2026 |
| For Petitioner | Ishita Farsaiya |
| For Respondent | A.S.G.I., Dhananjay Awasthi |
| Allahabad High Court | Read Order |
