Case Law Details
Hindustan Construction Company Limited Vs Union of India (Uttarakhand High Court)
Summary: In the case of Hindustan Construction Company Limited v. Union of India (WPMB No. 548 of 2024), the Uttarakhand High Court stayed the operation of Notification No. 56/2023, issued on December 28, 2023, which had extended the timelines for GST adjudication. The court scheduled the next hearing for February 25, 2025, alongside another related case (WPMB No. 523 of 2024). The stay order was significant as it halted the effect of the notification and all consequential orders that had been passed, questioning the validity of such extensions without proper legislative backing. This ruling comes in the context of a series of other high-profile court decisions that have similarly challenged the extended timelines. In a similar case, the Gauhati High Court had already declared the notification ultra vires, ruling that it lacked a recommendation from the GST Council and did not meet the criteria for invoking force majeure provisions. This decision has become a key precedent for taxpayers who argue that the extended timelines granted under the notification are legally flawed. Similarly, the Karnataka High Court recently stayed an order that involved erroneous refunds and mismatched returns, invoking the same notification under Section 168A of the CGST Act, which also lacked GST Council approval. These rulings, including the one from Uttarakhand, are pushing back on the extended deadlines, reflecting a broader legal challenge to the government’s handling of GST adjudications and the validity of such notifications without proper procedural compliance.
Our Comments:
The Gauhati High Court in the case of M/s Barkataki Print and Media Services v. Union of India & Ors. (WP(C)/3585/2024 dated September 09, 2024) ruled the Notification is ultra vires due to the absence of a GST Council recommendation and lack of force majeure grounds. This decision is a crucial precedent for taxpayers impacted by extended timelines under invalid notifications.
The Hon’ble Karnataka High Court stayed the operation of the adjudication order in the case of Siemens-Gamesa Renewable Power Pvt Ltd. v. Deputy Commissioner of Commercial Taxes & Ors. (Writ Petition No.31388/2024 dated December 10, 2024) directing recovery of erroneous refund and dues arising due to mismatch of returns pursuant to the order passed invoking the Notification issued under Section 168A of the Central Goods and Services Tax Act, 2017 (“the CGST Act”) and corresponding State Government Notification No. 6/2023 dated April 6, 2023 that extended the time limit for issuance of Show Cause Notice and passing of Orders for FY 2019-20 to August 31, 2024. The Petitioner’s challenge was based on two grounds:
i. Notification issued without prior recommendation of the GST Council as mandated by the statute and therefore time barred and without jurisdiction,
ii. Violation of principles of res-judicata and violative of Article-14 of the Constitution as no appeal has been filed against the refund order.
Further, stay orders have been passed on similar lines in other various High Courts.
FULL TEXT OF THE JUDGMENT/ORDER OF UTTARAKHAND HIGH COURT
1. Mr. Bharat Raichandani and Mr. Pulak Raj Mullick, learned counsels for the petitioner through video conferencing.
2. Mr. Manoj Kumar, learned Standing Counsel for the Union of India / respondent No. 1.
3. Ms. Puja Banga, learned Brief Holder for the State / respondent Nos. 3 to 5.
4. Mr. Shobhit Saharia, learned counsel for respondent Nos. 2 and 6 through video conferencing.
5. Learned counsel for the respondents
pray for and are granted six weeks’ time for filing counter affidavits.
6. List on 02.2025 along with WPMB No. 523 of 2024.
7. In the meantime, effect and operation of Notification No. 56/2023 dated 28.12.2023, and the consequential order, passed by respondent, shall remain stayed, till the next date of listing.
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