CASE TITLE:
Pappachan Chakkiath v. Assistant Commissioner & Ors.
DATE OF ORDER:
11 January 2023.
JUDGE(S):
Mr. Justice Gopinath P.
PARTIES:
Petitioner: Pappachan Chakkiath.
Respondent: Assistant Commissioner & Ors.
SUBJECT:
In the present case, the petitioner has challenged the order issued by the 1st respondent under Section 73 of the CGST/SGST Acts imposing on the petitioner.
BRIEF OF THE JUDGEMENT:
- The petitioner's counsel is arguing that the proceedings culminating in the order Ext.P4 are without jurisdiction.
- They claim that the liability was imposed in respect of the financial year 2017-18, and 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 utilised, relates.
- They argue that the time limit for issuance of an order for the financial year 2017-18 has been extended upto 30.09.2023 by virtue of Ext.P6 notification issued under the provisions of Section 168A of the CGST Act, but the time limit for issuance of a show cause notice has not been extended. Therefore, they are contending that unless the show cause notice was issued within the time specified in sub-section (2) of Section 73 read with provisions of sub-section (10) of Section 73, the entire proceedings have to be declared as one without jurisdiction.
- The Senior Government Pleader is arguing that when the time limit for issuing an order under subsection 10 of Section 73 is extended, the time limit for issuing a show cause notice under subsection 2 of the same section is automatically extended as well. This means that the party affected by the order will have more time to respond to the show cause notice.
- The petitioner is arguing that a notification under Section 168A of the law can only be issued in extraordinary circumstances. They are also arguing that since the notification does not specifically extend the time limit for issuing a show cause notice, it must be assumed that the time limit has not been extended. The lawyer is then citing a ruling from the Hon'ble Supreme Court of India in Commissioner of Customs (Import), Mumbai v. M/s.Dilip Kumar and Company and others [(2018) IX SCC 1] which states that any ambiguity in a taxing statute should be interpreted in favor of the taxpayer.
- The Court observed that Section 73 of the Income Tax Act states that a show cause notice must be issued at least three months prior to the time limit specified in sub-section (10) for the issuance of an order. This means that the show cause notice can be issued with reference to the date 30.09.2023, as the time limit specified in sub-section (10) has been extended to that date. There is no ambiguity in this provision, so no rule of interpretation needs to be applied.
- The court found that the petitioner failed to make out a case for interference and dismissed the petition. However, the petitioner's counsel requested that the time for filing an appeal against the order may be extended by two weeks, as the deadline was to expire the same day. The court considered the request reasonable and directed that the petitioner be allowed to file the appeal within two weeks. It also directed that the appeal should be considered on merits if it is filed within the two week period.
CONCLUSION
In conclusion, the court ruled that the petitioner failed to make out a case for interference and dismissed the petition. However, the petitioner was granted an extension of two weeks to file an appeal against the order. The court also directed that the appeal should be considered on merit if it is filed within two weeks.
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