The GST Policy Wing of the Government of India passed a set of notifications under S.168A of the CGST Act, 2017 whereby the time limits and limitation period of various activities and actions of different authorities on multiple issues were specified and extended to certain dates based on the nature of the activity.
However, multiple requests for clarifications were received by the Ministry of Finance, Govt. of India as to how and in what manner the time limitations would operate. The same was directed by the Supreme Court of India in Miscellaneous Application No. 665/2021 in SMW(C) No. 3/2020 to resolve the grievances of the people.
2. Order of the Hon’ble Supreme court dated 27th April 2021
The relevant extract of the Order passed by the Hon’ble Supreme Court of India is as follows:
“We, therefore, restore the order dated 23rd March, 2020 and in continuation of the order dated 8th March, 2021 direct that the period(s) of limitation, as prescribed under any general or special laws in respect of all judicial or quasi-judicial proceedings, whether condonable or not, shall stand extended till further orders. It is further clarified that the period from 14th March, 2021 till further orders shall also stand excluded in computing the periods prescribed under Sections 23 (4) and 29A of the Arbitration and Conciliation Act, 1996, Section 12A of the Commercial Courts Act, 2015 and provisos (b) and (c) of Section 138 of the Negotiable Instruments Act, 1881 and any other laws, which prescribe period(s) of limitation for instituting proceedings, outer limits (within which the court or tribunal can condone delay) and termination of proceedings. We have passed this order in exercise of our powers under Article 142 read with Article 141 of the Constitution of India. Hence it shall be a binding order within the meaning of Article 141 on all Courts/Tribunals and Authorities.”
– In Re: Cognizance for Extension of Limitation, 2021
3. Deliberation Of The 43rd Meeting Of The GST Council:
The aforementioned order of the Supreme Court was deliberated in the 43rd meeting of the GST Council. The Council in their deliberation provided various relaxations to the taxpayers and further decided that whenever the Supreme Court extends such limitations, they would apply equally in matters of the GST. Thereafter, a legal opinion was also sought on the extent of application of the order of the Hon’ble Supreme Court of India in this matter and a set of decisions were rendered by the GST Council.
Finally, the GST Policy Wing has clarified the issue of limitations raised by different stakeholders and using their power under Section 168(1) of the CGST Act, 2017 have clarified the same vide CIRCULAR NO. 157/13/2021- GST on 20/07/2021.
4. Final Decision Of The GST Council Post-legal Consultation
On the basis of the legal opinion, various actions/compliances under GST can be broadly categorised as follows: –
A. Proceedings/Compliances Needed To Be Done By Taxpayers-
These actions would continue to be governed as per the CGST Act, 2017 and time limit provided/ extensions granted under the statute itself. Various Orders of the Hon’ble Supreme Court would not apply to the said proceedings/ compliances on part of the taxpayers. Moreover, the appeals that are pending will be heard as per the CGST Act only.
B. Quasi Judicial Proceedings By Taxation Authorities-
The taxation authorities can continue to hear and dispose-off the proceedings which are already pending. The disposal may include disposal of application for refund, application for revocation of cancellation of registration, adjudication proceedings of demand notices, etc. Similarly, the appeals which are pending can be heard and dispose-off as per the CGST Act or any other notification issued.
C. Appeal By Taxpayers/Tax Authorities Against Any Quasi-judicial Order-
Wherever any appeal is required to filed before Joint/ Additional Commissioner (Appeals), Commissioner (Appeals), Appellate Authority for Advance Ruling, Tribunal and various courts against any quasi-judicial order or where a proceeding for revision or rectification of any order is required to be undertaken, the time line for the same would stand extended as per the Hon’ble Supreme Court’s order.