A Single Bench of the Kerala High Court, recently held that the extension granted to the time limit of passing demand order under the Central Goods and Services Tax (CGST) Act and State Goods and Services Tax (SGST) Act are applicable to issue of Show Cause Notice (SCN) also.
The assessee challenged that the order of GST demand issued under Section 73 of the CGST/SGST Acts imposing on the petitioner a total liability of Rs. 9.7 Lakhs, towards CGST and SGST payable by the petitioner for the period from July 2017 to March 2018.
Yash Thomas Mannully and Soman S Paul, counsels appearing for the petitioner, Pappachan Chakkiath submitted that the period for which the liability was imposed on the petitioner is in respect of the financial year 2017-18.
It was further submitted that under sub-section (10) of Section 73 of the CGST/SGST Acts, the time limit for completion of proceedings is three years from the due date for furnishing of annual return for the financial year to which the tax not paid or short paid or input tax credit wrongly availed or utilized and is applicable as such.
It was further argued that, It is submitted that by virtue of a notification issued under the provisions of Section 168A of the CGST Act, the time limit for issuance of an order for the financial year 2017-18 has been extended up to 30.09.2023.
It was thus contended that the terms of said notification is not applicable in this case as only the time limit for issuance of order has been extended and the time limit for issuance of a show cause notice has not been extended.
On the contrary, the SGP Thushara James contended that, “when the time limit for issuance of an order under sub-section(10) of Section 73 stands extended, automatically the time limit for issuance of a show cause notice under subsection(2) of Section 73 also stands extended.”
The Kerala High Court Bench of Justice Gopinath P observed that, “the show cause notice can also be issued with reference to the date 30.09.2023 and not with reference to any other date” and dismissed the writ petition.
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