Madras HC Declares GST Extension Notifications Under Section 168A Unconstitutional
The extension GST notification issued under Section 168A of the CGST Act, 2017, which extended the time limit for adjudication, has been quashed by the Madras High Court.
The bench of Justice Mohammed Shaffiq ruled that the Notification No. 09/2023 has specified poor in law since its issuance was not occasioned via a force majeure event or any proximate cause thereof, as obligated u/s 168A. Based on the fact that Notification No. 56/2023 was issued without the GST Council’s suggestions therefore it has been quashed.
The GST Implementation Committee decision shall not be considered as a recommendation of the GST Council, as the committee is neither a regulatory nor a constitutional body, the bench ruled.
The validity of Notification No. 09/2023 and Notification No. 56/2023-Central Tax has been challenged by multiple petitions on 28.12.2023 issued u/s 168A of the Central Goods and Services Tax Act of 2017/Tamil Nadu Goods and Services Tax Act of 2017.
Volvo Auto Indi Private Limited the applicant, had submitted the writ petition contesting the Demand Order establishing the GST demand of Rs. 1,01,90,58,244 u/s 73 of the Central Goods and Services Tax Act, 2017/Tamil Nadu Goods and Services Tax Act, 2017 along with applicable interest and penalty for the period April 2019 to March 2020 and asking the applicant to deposit the amount by 27.11.2024. Under the extension granted for issuance of Orders by Notification 56/2023 dated 28.12.2023, the said Demand Order was issued.
The Petition has been filed by the applicant contesting the Notification No. 56/2023-Central Tax validity extending the time limit for issuance of Orders for FY 2019-20 upto 31.08.2024 issued purportedly under the guidance of the GST Council as being ultra vires Section 168A of the CGST/TNGST Act in as much as it unable to fulfil the requirements precedent as mentioned u/s 168A of the CGST Act i.e., before the suggestions of the GST Council, rendering it as conflicting with the provision as breached of Articles 14 and 19(1)(g) of the Constitution of India.
Senior Advocate, Mr. Sujit Ghosh, assisted by Advocates from CSG Legal – Ms Mannat Waraich and Ms Jaya Rishi, said that as per section 168A, the GST council recommendation is a pre-condition for the issuance of the impugned notification.
