Central Board notification extending CGST assessment time limits under Section 73(9) found potentially invalid

The Gauhati HC examined the validity of notification No. 56/2023 dated 28.12.2023 issued by the Central Board of Indirect Taxes and Customs extending time limits for passing orders under Section 73(9) of the CGST Act, 2017. The court found the notification prima facie not in consonance with Section 168(A) of the CGST Act, 2017, indicating potential invalidity. The court granted interim protection to the petitioner, restraining coercive action based on the impugned assessment order dated 30.04.2024 pending further proceedings. Respondents were directed to file affidavits by 13.09.2024 regarding their position on force majeure applicability.

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Issues:
1. Validity of the notification issued by the Central Board of Indirect Taxes and Customs under Section 168A of the CGST Act, 2017 without recommendation from the GST Council.
2. Whether the notification extending the time limit for passing orders under Section 73(9) of the CGST Act, 2017 is ultra vires the law.
3. Applicability of force majeure in the extension of time limit for assessment proceedings.
4. Interpretation of provisions under the Assam Goods and Service Tax Act, 2017 in relation to notifications issued under the CGST Act, 2017.

Detailed Analysis:
1. The Petitioner challenged the validity of a notification issued by the Central Board of Indirect Taxes and Customs without a recommendation from the GST Council, as required under Section 168A of the CGST Act, 2017. The Petitioner argued that the notification, which extended the time limit for passing orders under Section 73(9) of the CGST Act, 2017, was issued without proper authority. The Petitioner contended that the notification was ultra vires the CGST Act, 2017 due to the absence of a recommendation from the GST Council, as mandated by law.

2. The Petitioner further argued that the reasons cited for the extension of the time limit, such as lack of manpower for audit and assessment, did not constitute a force majeure event. The Petitioner asserted that the extension granted by the notification was not justified under the circumstances presented, as the COVID period had ended, and previous extensions had already been granted. The Petitioner claimed that the notification was invalid on the grounds that it did not meet the criteria for invoking force majeure under Section 168A of the CGST Act, 2017.

3. The Petitioner also raised concerns regarding the applicability of the notification under the Assam Goods and Service Tax Act, 2017. The Petitioner argued that the notification, which extended the time limit for assessment proceedings, could not be applied under the Assam GST Act, as it did not align with the provisions of Section 11(4) of the AGST Act, 2017. The Petitioner contended that the State GST Authorities could not enforce a notification that was ultra vires the CGST Act, 2017 and did not fall within the scope of the Assam GST Act.

4. The Court acknowledged the arguments presented by both parties and observed that the notification in question did not comply with the provisions of Section 168A of the Central GST Act, 2017. The Court noted that if the notification was found to be invalid, all actions taken based on it would also be deemed invalid. The Court directed the Respondent Authorities to file affidavits and provide their stand on the applicability of force majeure in relation to the notification. Pending further proceedings, the Court granted interim protection to the Petitioner, prohibiting coercive actions based on the impugned assessment order.

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