Bunch of Petitions challenging Notification No.9/2023-CT issued by Govt for extension of time limits u/s 73 dismissed by High Court..

Background and Submission by Petitioners:

Challenge to Notification No.9/2023:

Challenge has arisen to Notification No. 09/2023 - Central Tax dated 31.3.2023 issued by Government of India u/s 168A of the CGST Act and corresponding SGST Notification, insofar those Notifications seek to extend the time granted to the Adjudicating Authorities to pass adjudication orders with reference to proceedings for the F.Y. 2017-18.

COVID-19 and its impact on GST:

It is a fact, F.Y. 2017-18 was the first year under the GST regime. It is a matter of common knowledge that the revenue authorities and the tax payers alike, faced numerous difficulties in complying the new law. Therefore, the time for making compliances was extended and relaxations were granted by the Government, from time to time.

And, just after the expiry of the last date for filing return for F.Y. 2017-18 expired on 07.2.2020, the country was hit by the first wave of the pandemic COVID-19, resulting in complete lockdown being declared, from 25 March 2020.

Introduction of TOLO and TOLA:

While the Parliament was not in session, the President promulgated Taxation and Other Laws (Relaxation of Certain Provisions) Ordinance, 2020 (referred to as ‘TOLO’) was published. Then, by Section 8 of TOLO, a new Section 168A was introduced to the Central Act, granting powers to the Central to issue appropriate notification, on the recommendations of the GST Council, to extend the time limit specified, prescribed nor notified under the Central Act in respect to ‘actions’ that ‘cannot’ be ‘completed’ or ‘complied’, ‘due to force majeure’ circumstance. 

It is also a fact that TOLO was replaced with Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 (referred to as ‘the TOLA’), enforced with effect from 31 March 2020. It contained provisions similar to TOLO. For our purpose, in material parts, TOLA is the mirror image of TOLO. 

Issuance of Notification No.9/2023:

Vide Notification No. 9/2023 dated 31.03.2023, the time limitation prescribed under Section 73(10) of the Central Act for F.Y. 2017-18, was extended upto 31.12.2023. This notification has also arisen under Section 168A of the Central Act. Challenge has been laid only to this last set of Notification dated 31.03.2023 issued by the Central Government and corresponding state notification.

It has been submitted, first, the time extension notifications have not arisen on an independent exercise but only by way of partial modification of the first time extension granted.

Second, it has been asserted that on 31.03.2023, there did not exist any COVID-19 circumstance at the time of issuance of the impugned notifications. The staff attendance at government and non-government offices stood regularised. Pre-existing office working restrictions were done away. Referring to the impugned time extension clause in Section 168-A of the Central Act and the State Act, it has been submitted that there did not exist any 'force majeure' circumstance.

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