The Supreme Court is set to examine whether the government can extend the time limit for adjudicating show cause notices (SCNs) under Section 73 of the GST Act by issuing notifications under Section 168A. This provision allows the government to extend time limits in case of force majeure (unforeseen extraordinary events).
Background of the Case:
A batch of petitions was initially filed before the Telangana High Court, challenging the validity of notifications Nos. 13/2022, 9/2023, and 56/2023 issued under Section 168A of the GST Act. The petitioners contended that:
- The show cause notice (SCN) was issued on 31.05.2024, but the adjudication order was passed on 29.08.2024, beyond the time limit prescribed under Section 73 of the Act.
- There was no force majeure situation to justify the extension of time.
- COVID-19-related extensions were applicable only until 28.02.2022, and thus could not justify further extensions.
- The notifications were issued without the recommendation of the GST Council, as required under Section 168A.
High Court’s Ruling:
The Telangana High Court examined past judgments from other High Courts, including:
- Allahabad High Court (Graziano Transmissions case) – Held that Supreme Court’s general relaxation of limitation periods does not apply to GST proceedings.
- Gauhati High Court (M/s. Barkataki Print case) – Stated that the recommendation of the GST Council is mandatory for any extension under Section 168A.
The High Court observed that Notification No. 56/2023 was issued without the prior recommendation of the GST Council, and ratification after issuance does not make it valid. It emphasized that the Council’s recommendation is crucial as it represents cooperative federalism, ensuring participation from all states.
However, the High Court also acknowledged that the Supreme Court had previously excluded the period from 15.03.2020 to 28.02.2022 for calculating limitation due to COVID-19. This exclusion rendered the validity of the notifications less significant in this case.
Supreme Court’s Involvement:
The petitioners have now challenged the High Court’s ruling in the Supreme Court, arguing that different High Courts have taken conflicting views on the issue. The Supreme Court, led by Justices J.B. Pardiwala and R. Mahadevan, has issued a notice to the respondents and scheduled the next hearing for 07.03.2025.
The outcome of this case will determine whether the government can extend the time limit for adjudicating SCNs under GST through notifications issued under Section 168A.
Download Order: M/S HCC-SEW-MEIL-AAG JV v. Assistant Commissioner of State Tax & Ors. [SLP (C) No. 4240/2025]
