HC grants stay on Demand Order wherein Validity of Extension Notifications Under section 168A of the CGST Act, Challenged

[CA Bimal Jain]

The Hon’ble High Court of Andhra Pradesh in the case of M/S. FLUENTGRID LIMITED VERSUS THE ADDITIONAL COMMISSIONER OF CENTRAL TAX AND OTHERS - 2024 (6) TMI 229 - ANDHRA PRADESH HIGH COURT held that it is the ‘due date’ and not the ‘actual date’ of filing of returns which is relevant for limitation purposes, and directed that no coercive action would be taken till the next date of hearing.

M/s. Fluentgrid Limited (“the Petitioner”) filed a writ petition Order in Original dated December 20, 2023 (“the Impugned Order”). The Petitioner sought direction to adjust the payment in Special Economic Zones (“SEZ”) registration with the demand raised in DTA registration without interest and penalties or alternatively direct the Additional Commissioner of Central Tax, Central GST Commissionerate to refund the excess paid GST in SEZ registration and permit the Petitioner to remit GST in DTA registration without interest and penalty.

The Petitioner challenged the Impugned Order and the Notifications issued under section 168A of the CGST Act, on the ground that the period of limitation of three years with effect from February 02, 2020, for passing orders for Assessment Year 2017-18 i.e. the extended period vide Notification No. 09/2023-Central Tax dated March 31, 2023 (“the Notification”).     

The Hon’ble High Court of Andhra Pradesh noted that, the ground of challenge is that the initiation of the proceedings is beyond the period of limitation as also extended period as SCN was not issued in consonance with the provisions of Section 73 (2) of the CGST Act. The Impugned Order is within the jurisdiction and no tax shall be levied. Further opined that, ‘due date’ and not the ‘actual date’ of filing of returns is relevant for the limitation purposes.  Lastly, held that, no cause is made out at the current stage for direction to the Petitioner to make any deposit, and till the next date of hearing no coercive action shall be taken with regard to the Impugned Order.

(Author can be reached at [email protected])