GST- Refund - Time limit

[PRASAD MVS]

Section 54(1) of CGSTA stipulates that an application for refund is to be made before the expiry of two years from the relevant date. Relevant date for filing a particular refund claim (inverted Tax structure) was 20.9.2018. The claim was filed on 20.9.2020. It is settled law in Central Excise and Customs that Section 9(1) of the General Clauses Act can be applied for counting limitation period. Section 9(1) of General Clauses Act provides that when the word “from” is used with reference to period of time, the first in the series of dates is to be excluded. Is there any provision in GST law barring the application of the said section of General Clauses ACT. If not, whether claim filed on 20.8.2020 is within the time? Please advice

[KASTURI SETHI]

Answer is NO.

Section 9 of General Clauses Act is applicable to CGST Act as per the decision of AAAR, Karnataka reported as 2020 (35) G.S.T.L. 519 (App. A.A.R. - GST - Kar.) = 2020 (3) TMI 982 - APPELLATE AUTHORITY FOR ADVANCE RULING, KARNATAKA in respect of DEPUTY CONSERVATOR OF FORESTS, BANGALORE but not for the purpose of refund claim.

First day(date) can be excluded for computation of time limit where communication is received from the department. Here is not the question of receipt of any communication rather the period of two years is fixed.

However, for knowledge sake, go through para no.12 of above decision of AAAR, Karnataka.

"12. It can be seen that Section 9 of the General Clauses Act applies to any of the Central Act or Regulations made after commencement of the said Act. Hence, applying the principle of Section 9 of the General Clauses Act to the CGST Act, the day on which the advance ruling order is communicated/served on the appellant (which is 4-10-2019 in this case) is to be excluded for the purpose of computing the limitation period. Accordingly, the period of thirty days to file the appeal in terms of Section 100(2) of the CGST Act commences from 5-10-2019 and ends on 3-11-2019. Proviso to Section 100(2) of the CGST Act empowers the Appellate Authority to allow the appeal to be presented within a further period not exceeding thirty days provided sufficient cause is shown. In this case, the grace period which was available to the appellant for filing the appeal commenced on 4-11-2019 and ended on 3-12-2019. The appeal in this case, has been filed on 4-12-2019 which is one day after the expiry of the grace period and beyond the condonable powers of the Appellate Authority."

[PRASAD MVS]

Thanks Sir for the update about the ruling of AAR.

Refund claim is to be filed before the expiry of two years from the relevant date. Whether the relevant date is also to be taken into account for computing Two years is the issue. If Section 9(1) of the General Clauses Act applies to CGST, then the phrase “from the relevant date” implies the exclusion of the first date i.e the day of the “relevant date”. The limitation provisions in Central Excise and Customs refunds are similarly worded viz “ before the expiry of six months/one year from relevant date”. Different benches of the Tribunal confirmed that Section 9(1) is applicable in such cases also. Some of the decisions are

1.Collector of Central Excise Vs SAIL Rourkela Steel Pant (1992 (61) ELT 732 (Tribunal)) = 1991 (9) TMI 212 - CEGAT, CALCUTTA

2.Sarvamangal Synthetics Ltd Vs Commr of C.Ex Coimbatore. 2003 (153) ELT 0545 (Tri. - Chennai) = 2003 (1) TMI 393 - CEGAT, CHENNAI

3.Commissioner of Central Excise, Meerut-II Vs Rollatainers Ltd 2002 (144) ELT 649 = 2002 (5) TMI 357 - CEGAT, NEW DELHI

[KASTURI SETHI]

I have gone through all the case laws referred to by you. Still I am of the view that the department will not allow such relaxation based on General Clauses Act. We are to rely on Central Excise Act and CGST Act regarding the computation of time limitation. Otherwise also one should not take risk and should comply with in time.

General Clauses Act was helpful only in the old era when last date fell on holidays and refund claims were used to be filed physically in the Range Office. Now in the era of High Technology, you cannot take the benefit of General Clauses Act as refund is to be filed online.

AI Summary

Limitation computation under General Clauses Act may not extend GST refund filing period, so file within the two-year limit.
Whether the General Clauses Act's rule excluding the first day applies to the CGST Act's requirement to file refund claims "before the expiry of two years from the relevant date" is contested. An AAAR decision applied the exclusion rule for appeal time computation but not for refund claims; tribunal precedents under Central Excise support exclusion for refund limitations, yet practitioners warn that revenue authorities are unlikely to permit such relaxation and advise filing within the two-year online deadline.