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TaxTMI 
TaxTMI 
2024 (12) TMI 440
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....ices, M/s. Pushpak Pharmaceuticals, M/s. Schwing Stetter (India) Private Limited, M/s. Classic Services, M/s Mother India Construction Pvt. Ltd. M/s. Manas., M/s. Chaurasia Enterprises, Versus The State of Bihar, The Principal Secretary Cum Commissioner, Department of State Taxes, Government of Bihar, Patna., Assistant Commissioner of State Tax, The Union of India, The Secretary, Department of Revenue, Govt. of India, New Delhi., The Principal Commissioner of Central Goods and Service Tax, New Delhi., The Commissioner of Central Tax Patna, The Joint Commissioner of State Tax, Patna, The Assistant Commissioner of State Tax, Patna, Appearance : (In Civil Writ Jurisdiction Case No. 4180 of 2024) For the Petitioner/s : Mr. Bijay Kumar Gupta, Advocate For the Respondent/s : Mr. Standing Counsel 11 Dr. K. N. Singh, Additional Solicitor General Mr. Anshuman Singh, Sr. SC, CGST&CX Mr. Devansh Shankar Singh, Advocate Mr. Shivadity D. Sinha, Advocate (In Civil Writ Jurisdiction Case No. 4505 of 2024) For the Petitioner/s : Dr. Alok Kumar Sinha, Advocate Mrs. Raj Rashmi Sinha, Advocate Mr. Raja Prasad, Advocate For the Respondent/s : Dr. K. N. Singh, Additional Solicitor ....
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.... Singh, Advocate Dr. Avinash Poddar, Advocate Mr. Punit Siddhartha, Advocate For the Respondent/s : Dr. K. N. Singh, Additional Solicitor General Mr. Anshuman Singh, Sr. SC, CGST&CX Mr. Devansh Shankar Singh, Advocate Mr. Shivadity D. Sinha, Advocate Mr. Vikash Kumar, SC 11 (In Civil Writ Jurisdiction Case No. 6211 of 2024) For the Petitioner/s : Mr. Sadashiv Tiwari, Advocate. For the Respondent/s : Dr. K. N. Singh, Additional Solicitor General Mr. Anshuman Singh, Sr. SC, CGST&CX Mr. Devansh Shankar Singh, Advocate Mr. Shivadity D. Sinha, Advocate Mr. Vikash Kumar, SC 11 (In Civil Writ Jurisdiction Case No. 6533 of 2024) For the Petitioner/s : Mr. D.V. Pathy, Advocate Mr. Sadashiv Tiwari, Advocate Ms. Prachi Pallavi, Advocate Mr. Hiresh Karan, Advocate For the Respondent/s : Dr. K. N. Singh, Additional Solicitor General Mr. Anshuman Singh, Sr. SC, CGST&CX Mr. Devansh Shankar Singh, Advocate Mr. Shivadity D. Sinha, Advocate Mr. Vikash Kumar, SC 11 (In Civil Writ Jurisdiction Case No. 6831 of 2024) For the Petitioner/s : Mr. Bijay Kumar Gupta, Advocate Mr. Manish Kumar, Advocate For the Respondent/s : Mr. Vikash Kumar, SC 11 Dr. K. N. Singh, Additional S....
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.... K. N. Singh, Additional Solicitor General Mr. Anshuman Singh, Sr. SC, CGST&CX Mr. Devansh Shankar Singh, Advocate Mr. Shivadity D. Sinha, Advocate Mr. Vikash Kumar, SC 11 (In Civil Writ Jurisdiction Case No. 9108 of 2024) For the Petitioner/s : Mr. Bijay Kumar Gupta, Advocate Mr. Manish Kumar, Advocate Mr. Rajeev Nayan, Advocate For the Respondent/s : Dr. K. N. Singh, Additional Solicitor General Mr. Anshuman Singh, Sr. SC, CGST&CX Mr. Devansh Shankar Singh, Advocate Mr. Shivadity D. Sinha, Advocate Mr. G.P.-7. (In Civil Writ Jurisdiction Case No. 9218 of 2024) For the Petitioner/s : Dr. Alok Kumar Sinha, Advocate Mrs. Raj Rashmi Sinha, Advocate Mr. Raja Prasad, Advocate For the Respondent/s : Dr. K. N. Singh, Additional Solicitor General Mr. Anshuman Singh, Sr. SC, CGST&CX Mr. Devansh Shankar Singh, Advocate Mr. Shivadity D. Sinha, Advocate Mr. Vikash Kumar, SC 11 (In Civil Writ Jurisdiction Case No. 9453 of 2024) For the Petitioner/s : Mr.Brisketu Sharan Pandey, Advocate Mr. Abhishek Kumar, Advocate Mr. Madan Kumar, Advocate For the Respondent/s : Dr. K. N. Singh, Additional Solicitor General Mr. Anshuman Singh, Sr. SC, CGST&CX Mr. Devansh Shankar Sing....
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....te Mr. Sushil Ranjan Sinha, Advocate For the Respondent/s : Dr. K. N. Singh, Additional Solicitor General Mr. Anshuman Singh, Sr. SC, CGST&CX Mr. Devansh Shankar Singh, Advocate Mr. Shivadity D. Sinha, Advocate Mr. Vikash Kumar, SC 11 (In Civil Writ Jurisdiction Case No. 11510 of 2024) For the Petitioner/s : Mr. Bijay Kumar Gupta, Advocate Mr. Manish Kumar, Advocate For the Respondent/s : Dr. K. N. Singh, Additional Solicitor General Mr. Anshuman Singh, Sr. SC, CGST&CX Mr. Devansh Shankar Singh, Advocate Mr. Shivadity D. Sinha, Advocate Mr. Vikash Kumar, SC 11 (In Civil Writ Jurisdiction Case No. 11511 of 2024) For the Petitioner/s : Mr. Bijay Kumar Gupta, Advocate Mr. Manish Kumar, Advocate For the Respondent/s : Dr. K. N. Singh, Additional Solicitor General Mr. Anshuman Singh, Sr. SC, CGST&CX Mr. Devansh Shankar Singh, Advocate Mr. Shivadity D. Sinha, Advocate Mr. Vikash Kumar, SC 11 (In Civil Writ Jurisdiction Case No. 11662 of 2024) For the Petitioner/s : Mr. Bijay Kumar Gupta, Advocate Mr. Manish Kumar, Advocate For the Respondent/s : Dr. K. N. Singh, Additional Solicitor General Mr. Anshuman Singh, Sr. SC, CGST&CX Mr. Devansh Shankar Singh, Advoc....
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....re passed on the basis of the extension; beyond the period of three years from the 31st of December of the subject year; which is the limitation provided under Section 73 (10). The petitioners contend that the notifications issued under Section 168A of the GST Act was after the pandemic period and in that circumstance, there could not have been any extension of limitation. 2. The different petitioners in the writ petitions have raised multiple grounds for challenging the orders passed; primarily on limitation; then on the grounds of a notice having not been issued under Section 61 of the GST Act read with Rule-99, as also violation of the principles of natural justice; which allegation is levelled for reason of no personal hearing having been afforded as mandated under Section 75 (4). We would first deal with the common ground in all the writ petitions with respect to limitation; which as available in the GST Act stood extended based on the pandemic situation. 3. We have heard Sri. D.V. Pathy, Dr. Avinash Poddar, Sri. Bijoy Kumar Gupta and Sri. Aman Raza, learned Counsel appearing for the writ petitioners, Sri. P.K. Shahi, learned Advocate General for the State and Dr. K.N. S....
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....-44 (1). 6. If the due date as provided in Section 44 of the GST Act was applicable, then the limitation under Section 73 (10) of the GST Act, for making an order would expire respectively on (i) 31.12.2021 (2017-18), (ii) 31.12.2022 (2018-19) and (iii) 31.12.2023 (2019-20). The pandemic was first visible towards the end of the year 2019 and the situation escalated over the next few months and in India, a complete lock down was declared on 25.03.2020. The complete nation-wide lock down though lasted only till 31st May-2020, the situation continued to be grim; seriously affecting and jeopardizing every human activity, not only in India but all over the world. Life came to a stand-still and the statutory compliances were seriously hampered and the statutory proceedings and processes stood suspended for multifarious reasons; of affliction with COVID-19 pandemic, limited lock down of local areas, restricted attendance and reduced foot-falls in government offices and so on and so forth. 7. The Hon'ble Supreme Court rose up to the occasion and Suo motu Writ Petition No. (Civil) No. 3 of 2023 was registered, as Re: Cognizance for Extension of Limitation. The limitation under the var....
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....anted for the year 2017-18, also provided extension for the year 2018-19 till 31.03.2020. Again for the years 2018-19, the last date for filing returns stood extended to 30.06.2020 by Notification No. 15/2020-Central Tax, to 30.09.2020 by Notification No. 41/2020-Central Tax, to 31.10.2020 by Notification No. 69/2020-Central Tax and 31.12.2020 by Notification No. 80/2020-Central Tax. By Notification No. 95 of 2020-Central Tax dated 30.12.2020, the due date for filing of annual returns under Section 44 (1) of the GST Act for the year 2019-20 was also extended upto 28.02.2021. This again stood extended by Notification No. 4/2021-Central Tax to 31.03.2021. The due dates for filing annual returns in all the three subject years, stood extended to the dates mentioned above. The GST regime, as was the case in the VAT regime, had a system of self-assessment [Section 73(5)] and hence no proceeding for determination of tax, short paid, escaped, erroneously refunded or input tax wrongfully claimed for the assessment year, could be initiated before the due date of filing annual returns. 10. The aforesaid extension was to mitigate the difficulties of the assesses; expressed by the assesses, ....
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....d in this Act, the Government may, on the recommendations of the Council, by notification, extend the time limit specified in, or prescribed or notified under, this Act in respect of actions which cannot be completed of complied with due to force majeure. (2) The power to issue notification under sub-section (1) shall include the power to give retrospective effect to such notification from a date not earlier than the date of commencement of this Act." 13. The said provision was introduced invoking the power conferred on the Parliament and the Legislature of every State under Article 246A of the Constitution of India. Immediately, we notice that Section 168A is thus framed in contradistinction to the power of recommendation conferred under Article 279A (4) on the Goods and Services Tax Council constituted under Article 279A of the Constitution of India. 14. The first Notification to be issued under Section 168A of the GST Act, 2017 was Notification No. 35/2020, issued by the Central Board of Indirect Taxes & Customs (CBIC) dated 03.04.2020. It provided inter alia extension of time up to 31.08.2020 with respect to actions for which the time limit for completion or comp....
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....etween 01.03.2020 to 28.02.2022 for computation of period of limitation under Section 73 (10) of the GST Act, insofar as orders for recovery of erroneous refund under Section 73 (9) of the GST Act; while also excluding the said period from the limitation, for filing refund applications under Section 54 & Section 55 of the GST Act. Here, we have to observe that the very same period was excluded by the Hon'ble Supreme Court in computing the limitation period under general or special laws, in respect of all judicial or quasi-judicial proceedings. The difference was very negligible, insofar as the Hon'ble Supreme Court having excluded the period between 15.03.2020 to 28.02.2022; 14 days lesser than that ordered by the Government. It is common knowledge that the pandemic situation had commenced earlier and only on it escalating beyond control that the lock-down was imposed on 25.03.2020. The petitioners do not challenge the extension made for filing refund applications but only challenge the limitation period for passing orders having been extended. 18. The decision so arrived at, extending limitation was also not without application of mind. The notification was issued in pursuance ....
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....ect of erroneous refunds sanctioned. Therefore, Law Committee also recommended that time period from 01.03.2020 to 28.02.2022 may be excluded from the limitation period for filing refund claim by an applicant under Section 54 and 55 of CGST Act, as well as for issuance of order / demand in respect of erroneous refunds under Section 73, by exercising power under section 168A of CGST Act. The Council agreed with the recommendations of the Law Committee along with the proposed draft notification under Section 168A of CGST Act, subject to the vetting by the Law Ministry." (underlining by us for emphasis) 19. The notification also came into force w.e.f. 01.03.2020, retrospectively, as enabled under sub-section (2) of Section 168A of the GST Act. Hence, the force majeure situation which was reckoned by the GST Council, in making recommendations to the Government, was the COVID-19 pandemic which though had commenced in 2019, intensified by 01.03.2020; 24 days after which, a country-wide lock down was enforced in India. Notification No. 13 of 2020 though issued on 05.07.2022 had a retrospective effect from 01.03.2020; when the pandemic struck with all force, resulting ....
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.... limit under Section 73 of CGST Act for issuance of Show Cause Notices (SCN) and Orders for financial year 2017-18, 2018-19 and 2019-20, considering that the scrutiny and audit were delayed because of Covid-19 pandemic. He informed that the issue was discussed by the Law Committee and it was observed that earlier, such extension was given for the F.Y. 2017-18. It was felt by the Law Committee that while there may be a need to provide additional time to the officers to issue notices and pass orders for FY 2017-18, 2018-19 and 2019-20 considering the delay in scrutiny, assessment and audit work due to COVID-19 restrictions, however, the same need to be made in a manner such that there is no bunching of last dates for these financial years as well as for the subsequent financial years. After detailed deliberations, Law Committee recommended that such time limits may be extended for another three months each for the FY 2017-18, 2018-19 and 2019-20. It was discussed in detail in officers meeting where one view was that extension for FY 2017-18 had already been given and further extension may create a perception that it is not a tax friendly measure and against the interest of taxpayers.....
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.... the time limit may be extended from the present 31st March, 2024 to the 30th June, 2024." 23. Hence, both the above Notification Nos. 13/2022-Central Tax and 9/2023-Central Tax are brought out with prior recommendation of the GST Council. Now, the dispute narrows down to Notification No. 56/2023-Central Tax and the absence of a recommendation of the GST Council; prior to its issuance. 24. Reliance was also placed on the facts as narrated in the judgment of the Gauhati High Court in WP(C) No. 3585 of 2024, titled M/s. Barkataki Print and Media Services & Anr. V. Union of India & Ors. and analogous cases dated 19.09.2024, produced as Anenxure-P/7 in CWJC No. 4180 of 2024. The judgment of the learned Single Judge of the High Court was not put forth as a binding precedent, but only for purpose of reference to the admission of the Central Government, that Notification No. 56/2023 was not issued pursuant to a recommendation by the GST Council. The learned Single Judge of the High Court relied on Union of India & Anr. v. Mohit Minerals Private Limied, (2022) 10 SCC 700 to find that the object behind the insertion of Articles 246A and 279A read with the overriding provisions in Arti....
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....ion on the value of such a recommendation. Yet the notion that the recommendations of the GST Council transform into legislation in and of themselves under Article 246-A would be far-fetched. If the GST Council was intended to be a decision-making authority whose recommendations transform to legislation, such a qualification would have been included in Articles 246-A or 279-A. Neither does Article 279-A begin with a non-obstante clause nor does Article 246-A provide that the legislative power is "subject to" Article 279-A." 26. We also extract the conclusions arrived at by the Hon'ble Supreme Court, relevant for the subject matter in these cases, as below:- E. Conclusion 171. Based on the above discussion, we have reached the following conclusion: 171.1. The recommendations of the GST Council are not binding on the Union and States for the following reasons: 171.1.1. The deletion of Article 279-B and the inclusion of Article 279(1) by the Constitution Amendment Act, 2016 indicates that Parliament intended for the recommendations of the GST Council to only have a persuasive value, particularly when interpreted along with the objective of the GS....
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....hich recommended extension of the period to a specific date. The caveat noticed by the Hon'ble Member of the State of Bihar, as we noticed hereinabove, that there should be no further extension, was also not accepted by the GST Council. 29. We take note of the supplementary counter affidavit dated 03.10.2024 filed by the 3rd Respondent in CWJC No. 4180 of 2024, in which is produced Annexure-3/2 series; being the minutes of the 52nd GST Council meeting and the 53rd meeting of the GST Council, which had ratified the notifications, circulars and orders issued by the Central Government and the decisions of the GST Implementation Committee. At the 52nd meeting, Notification No. 56/2023-Central Tax seeking to extend dates of specified compliances in exercise of powers under Section 168A of the GST Act has been ratified. It is also to be emphasized that Notification No. 56/2023-Central Tax specifically modifies the earlier notifications issued; starting from Notifications 35/2020-Central Tax, to 14/2021, 13/2022 and 9 of 2023. With due respect, we are unable to agree with the reasoning in the judgment of the learned Single Judge of the Gawhati High Court, which led to setting aside of ....
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....t by the impugned notifications did not extend the limitation for the entire period granted by the Hon'ble Supreme Court. At the risk of repetition, the extended date of filing of return under Section 44(10) of the GST Act for the years 2017-18, 2018-19 and 2019-20 were respectively on 07.02.2020, 31.12.2020 and 31.03.2021. The three-year period under Section 73 (10) of GST Act hence commences from such dates and would have normally expired respectively on 07.02.2023, 31.12.2023 and 31.03.2024. For the year 2017-18 the period between 15.03.2020 to 28.02.2022; 2 years minus 14 days come within the period of limitation. Hence the period of 1 year, 11 months and 16 days have to be excluded for the year 2017-18, which would take the limitation period to 21.01.2025. 34. Similarly, in the financial year 2018-19, the period between 01.01.2021 and 28.02.2022 should be excluded from the three-year period commencing from the extended date of filing amended returns for that year; i.e: between 31.03.2020 to 31.12.2023. The 01 year 02 months so excluded would extend the limitation from 31.12.2023 to 28.02.2025, for the assessment year 2018-19. Likewise, for the financial year 2019-20 the ext....
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....on made by its expert i.e., Council, we find it difficult to hold that there was no application of mind by the delegate in issuing the impugned Notifications. The material existed as has been discussed above. The application of mind is writ large on the face of the agenda and minutes relied by learned counsel for the petitioners and admitted to the respondents. 110. Once we have held that issuance of the time extension application was a legislative function and there existed material and due deliberation/ consideration over/of to that material, before the legislative function was performed, the first condition of existence of circumstances for exercise of the said power described as conditional legislation, stood fulfilled. Therefore, the ratio of the decision of the Supreme Court in Mohit Minerals Private Limited (supra) is also of no avail. By way of principle it may not be doubted that the recommendations of the Council remained persuasive. The Central Government and the State Government were not duty bound to conform thereto. However, in absence of any fact shown to exist, the Central Government and the State Government have exercised their conditional legislative func....
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.... years and nine months from the last date of filing of Annual Return, that reasonable period of time extended up to November, 2022. 114. While the order of the Supreme Court in Re: Cognizance for Extension of Limitation (supra) may not per se apply to an adjudication proceeding and it is not the case of the respondents that they claim direct benefit of that relaxation of limitation granted for the period 15.03.2020 to 28.02.2022, at the same time, we must remember that judicial notice was taken of the disabling events triggered by the spread of the pandemic COVID-19, by the highest Court of the land. That judicial recognition of that fact, was commonly known to all, itself is irrebuttable evidence of both the extent of disablement and the length of time for which such disablement continued to exist, unabated. In face of that recognition and established truth, no use or purpose may be served in offering any deliberation. Therefore, we conclude, the revenue authorities were visited with a circumstance that was not of their making. It was not a mere difficulty of the usual kind. It was not a wholly temporary or transient impairment caused to their functioning. Beginning 15.03....
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.... exempted by the Hon'ble Supreme Court. However, since notifications are issued by the respective Governments extending the period of limitation, necessarily the limitation for the three subject years would stand extended only to that notified. 41. We find absolutely no reason to interfere with the orders passed, on the ground of limitation. 42. The next contention raised on behalf of some of the petitioners is based on Section 61 of the GST Act and Rule 99 of the GST Rules. Section 61 speaks of scrutiny of returns and the related particulars furnished by the registered person, to verify the correctness of the return and if any discrepancy is noticed, the requirement to inform such discrepancy to the assessee in the manner prescribed and seek explanation thereto. Rule 99 prescribes the manner in which the notice has to be issued in Form-GST ASMT-10. The contention is that, without such notice and a consideration of explanation by the assessee, there can be no proceeding initiated under Section 73. 43. While Section 69 provides for scrutiny of returns, Section 73 visualises a proceeding, when it appears to the Proper Officer, that any tax has not been paid or short paid and....