16(4) time limit

[VENU K]

The department has passed all orders relating to 2019-2020 under Sec 73 denying benefit of extended time period proposed in the budget for 16(4) saying

' Though clause 114 of the Finance Bill proposed an amendment in Sec 16 no notification is issued till date of this order and the recommendations of the 53rd GST Council are yet to be made fully effective. Therefore, I do proceed further on the basis of prevailing provisions as per the Act/Rules.'

They have no option because the time limit to pass an order is expiring on 31st August 2024 so they have to anyway pass the order.

Now , what should the tax payer do -

Wait for the notification (Is there a chance of it coming within 3 months is another question) and then go for a rectification ?

File an Appeal ?

[Alkesh Jani]

Shri,

I am of the view that file an appeal.

Thanks

[Sadanand Bulbule]

Dear Sir

As rightly expressed by you, wait for next 3 months.Hopefully effective notification would be in place entitling the desired benefit under Section 16[5] by that time.

Filing of an appeal is an expensive in terms of deposit of 10% disputed tax amount, which at this point of time does not warrant.

[KASTURI SETHI]

Dear Querist,

Notification is expected to be issued at any time. It is not right time to be pro-active at this stage. Waiting for is the right decision. The grounds of appeal will be buttressed if you file appeal after the issuance of the notification. 

[KASTURI SETHI]

If you wait for the notification, no harm is feared. Rather, waiting for will yield better results in  your favour. 

[Sadanand Bulbule]

Dear querist

I agree with Sh.Sethi Sir.Go with his opinion.

[Girish Kumar]

The Taxpayer has to wait for the notification and guidance to the GST officers in this issue. No need to worry about the order passed as GST council is already  acknowledge the issue and Finance act is already passed with changes.

[Kapil Goplani]

My client is also facing same issue, but payment need to be made till 27/9/24 as per order, what is remedy after that, If officer attached bank account / itc blokage there will be big issue and what is proper timeline for filling appeal if go for this option

[Sadanand Bulbule]

Dear Sir

Even the Hon'ble High Courts have taken such recovery proceedings seriously by-passing the object of Section 16 [5]. You can appraise legal position to the authority in writing & request to keep such proceedings in abeyance. Officers having judicial discipline would act positively and others may reject it and proceed to meet the "collection" targets.

[KASTURI SETHI]

I concur with the views of Sh. Sadanand Bulbule, Sir Ji. In addition to his advice, I further opine as under :

(i) The date 27.09.24 is still far away. Hopefully, notification may be issued much prior to 27.09.24.

(ii) Further, regarding judicial discipline, here is the judgement of the Supreme Court in the case of UOI Versus KAMLAKSHI FINANCE CORPORATION LTD. - 1991 (9) TMI 72 - SUPREME COURT. The orders of Higher Authorities/Higher Courts are binding on the lower authorities (Adjudicating Authorities) and Appellate Authorities (Commissioner (Appeals) and Appellate Tribunals. The Supreme Court had held as under :-

“Precedent - Principles of judicial discipline - Orders passed by Collector (Appeals) and Tribunal binding on all adjudicating and appellate authorities within their respective jurisdiction.

It cannot be too vehemently emphasised that it is of utmost importance that, in disposing of the quasi-judicial issues before them revenue officers are bound by the decisions of the appellate authorities. The order of the Appellate Collector is binding on the Assistant Collectors working within his jurisdiction and the order of the Tribunal is binding upon the Assistant Collectors and the Appellate Collectors who function under the jurisdiction of the Tribunal. [para 6]”.

The latest High Court judgement and above Supreme Court judgement should be referred to while making representation to the concerned authorities of the CGST/SGST department.

[Alkesh Jani]

Dear Experts,

I have expressed the opinion that it is prudent to file an appeal in the event that a notification is issued within three months of the order. This approach is advisable as it ensures compliance with the timeline, thereby safeguarding the taxpayer's interests. However, if the notification is not issued within this period, even after accounting for the available condonation period, the taxpayer may encounter significant obstacles in seeking justice.

Additionally, under the provisions of the Finance Act, 2024, the taxpayer is obligated to pay the assessed tax amount. In this context, the pre-deposit made may be adjusted against the tax liability, and all recovery proceedings are considered stayed. Please refer to Circular No. 224/18/2024-GST for further clarification on this matter.

I acknowledge and appreciate the insightful views shared by our experts, which represent the best available guidance.

Thank you.

[Sadanand Bulbule]

Dear Jani Sir

Very good gesture. Deserves appreciation.

[KASTURI SETHI]

Sh.Sadanand Bulbule Ji,

Sir, I fully agree with your views at serial no.11 dated 31.8.2024.

(2) Sh. Alkesh Jani Ji is synonymous with discipline, fellowship, sportmanspirit, no-confrontation, humbleness & hunger-for-learning. How to respect the seniors is reflected in his ALL replies. All his replies prove these virtues inherent in his personality.

(3) "How a player behaves in the playground is his/her real character" -------Sachin Tendulkar, famous cricketer.

(4) There was a news day before yesterday that the notification regarding effective date will be issued after GST Council meeting to be held on 09.09.2024. So no person will suffer. The fear of crossing the date will vanish.

[Sadanand Bulbule]

Dear Sh Sethi Sir ji

"We do not get what we desire, but we get what we are". There is no respect for others without humility within one's self. Nothing is more beautiful than the humility.

You have rightly phrased it Sir.

[KASTURI SETHI]

Sh. Sadanand Bulbule Ji,

Sir, You are absolutely right.

Humility is also one of the major characteristics of personality 

[VENU K]

Thank you all for the illuminating discussion. Let us hope the Department, finally gives clarity on the issue,  and once it is notified ,it would not   lead to  further rounds of  litigation on the subject.

[Alkesh Jani]

Shri Kasturji Sir &  Shri Sadanand Ji,

Thank you for such a meaningful recognition. It is my privilege to uphold these values, and your kind words serve as a powerful reminder of why I strive to do so. Your appreciation inspires me to continue cultivating these virtues in all aspects of life, It is you all who have shaped, sharpened and shined me from coal to diamond. I deeply respect and appreciate your thoughtful acknowledgment.

Thanks again,

With Due Regards

[KASTURI SETHI]

Sh.Alkesh Jani Ji,

Credit goes to your hard work and zeal and not to me. Kudos to you. Sincerity and honesty towards work are always rewarded by God. Keep it up.

[YSreenivasa Reddy]

I have a query can anyone give clarity regarding this: If the taxpayer has not filed an appeal against the impugned order under Section 16(4) with in the time frame of 3 months, can the department initiate recovery proceedings in such a case

[KASTURI SETHI]

Dear Querist,    What is the period of demand  ? There is also one month extension . The delay for one month  is condonable only on solid ground.

AI Summary

GST Department Denies Extended Time for 2019-2020 Orders; Debate on Appeals vs. Waiting for Notification under Section 73 A discussion forum addressed the issue of the GST department denying the extended time period for orders related to 2019-2020 under Section 73, due to the absence of a notification implementing the proposed amendment in Section 16. Participants debated whether taxpayers should wait for the notification or file an appeal. Some advised waiting for the notification to avoid unnecessary costs, while others suggested filing an appeal to protect taxpayer interests. The discussion also touched on judicial precedents and the potential for recovery proceedings if appeals are not filed promptly. Participants expressed hope for clarity from the department to prevent further litigation.