Big news on section 168A of CGST Act, notice issued

The Supreme Court (SC) is set to hear a Special Leave Petition (SLP) concerning the validity of Notification Nos. 09/2023 and 56/2023 issued under Section 168A, which pertain to extending the limitation periods for certain tax-related actions.

Overview of the Case

The SLP challenges a judgment from the Telangana High Court (HC) that upheld the validity of Notification Nos. 13/2022-Central Tax and 09/2023-Central Tax. These notifications were issued under Section 168A, extending the limitation period under Section 73(10) for passing orders under Section 73(9), with the exception of Notification No. 56/2023.

During a recent hearing involving a large batch of writ petitions, the Telangana HC aligned its ruling with decisions from the Allahabad and Patna HCs. The court interpreted the phrase “in respect of actions” within Section 168A as “very wide,” inferring that it indeed includes actions that were delayed due to force majeure events, particularly amid the COVID-19 pandemic.

Key Focus of the Supreme Court

The HC’s judgment also touched upon Notification No. 56/2023, which was deemed invalid due to its ratification occurring six months post-issuance by the 53rd GST Council. This ratification relied on a decision from the GST Implementation Committee/Law Committee, which the HC ruled could not validate the notification.

The Supreme Court’s primary focus in the forthcoming SLP will be the legality, validity, and propriety of Notification Nos. 09/2023 and 56/2023. Specifically, the court will evaluate whether the extension of the time limit for adjudicating Show Cause Notices (SCNs) related to orders under Section 73 for the financial year (FY) 2019-20 has been arbitrarily extended through these notifications.

Arguments Regarding Notification No. 09/2023

Notification No. 09/2023-CT has faced scrutiny, with challenges based on the argument that, absent a force majeure condition, the Government lacked the authority to invoke powers under Section 168A of the CGST Act.

The next hearing date for this matter is set for March 7, 2025.

Conclusion

The resolution of this case will have significant implications for GST compliance and the legal interpretation of Section 168A, especially as it pertains to the limitations on adjudication periods during extraordinary circumstances. The outcome could set important precedents in tax law and administrative procedure.

Case Reference: SC – M/S HCC-SEW-MEIL-AAG JV vs. ASSISTANT COMMISSIONER OF STATE TAX [SLP(C) No. 4240 of 2025]