U.P. Projects Consultants Private Limited Vs State of U.P. (Allahabad High Court)
Allahabad High Court recently addressed the critical issue of timeliness in the issuance of assessment orders under the Uttar Pradesh Goods and Services Tax Act, 2017 (UP GST Act). The case, involving U.P. Projects Consultants Private Limited against the State of U.P., hinged on whether an ex-parte order passed under Section 73 of the Act for the Financial Year 2017-18 was within the prescribed period of limitation.
The petitioner, U.P. Projects Consultants Private Limited, challenged an ex-parte order dated December 30, 2023, arguing it was time-barred. Their counsel drew the court’s attention to a previous judgment by the same court in Writ Tax No. 264 of 2024 (decided on November 12, 2024), which the petitioner contended supported their position that the order was beyond the permissible time frame.
In the referred judgment (Writ Tax No. 264 of 2024), the court had examined Section 73(10) of the UP GST Act, which mandates that an order under Section 73(9) for recovery of tax, etc., must be issued within three years from the due date of furnishing the annual return for the relevant financial year. Section 44(1) of the Act stipulates the due date for filing the annual return as December 31st following the end of the financial year, though this date can be extended by notification.
For the Financial Year 2017-18, the due date for filing the annual return was initially December 31, 2018. However, this was extended to February 5, 2020, via a notification from the Central Board of Indirect Taxes and Customs, adopted by the State of U.P. According to the court’s reasoning in Writ Tax No. 264 of 2024, based on the extended due date of February 5, 2020, the three-year limitation period under Section 73(10) would expire on February 5, 2023.
The state, in Writ Tax No. 264 of 2024, had relied on a notification dated April 24, 2023, which purported to extend the time limit under Section 73(10) for the Financial Year 2017-18 up to December 31, 2023. However, the court in that case observed that this notification was given retrospective effect only from March 31, 2023. Consequently, if the original three-year period expired before March 31, 2023 (as it did on February 5, 2023), the April 24, 2023 notification would not revive the time limit. Based on this, the court in Writ Tax No. 264 of 2024 found the impugned orders in that case (dated October 5, 2024, and December 2, 2023) to be time-barred and beyond jurisdiction.
However, in the present case of U.P. Projects Consultants Private Limited, the learned Additional Chief Standing Counsel for the State presented a notification dated July 21, 2022, which had not been brought to the court’s notice during the proceedings of Writ Tax No. 264 of 2024. This notification, issued under Section 168A of the UP GST Act, explicitly extended the time limit under Section 73(10) for the Financial Year 2017-18 up to September 30, 2023. Furthermore, this notification was deemed to have come into effect from March 1, 2020.
Upon considering the notification dated July 21, 2022, the High Court in the U.P. Projects Consultants Private Limited case noted that while the initial three-year period from the extended annual return due date (February 5, 2020) would end on February 5, 2023, the July 21, 2022 notification extended this time limit up to September 30, 2023, for the Financial Year 2017-18. The court further acknowledged that the subsequent notification of April 24, 2023, which took effect from March 31, 2023, further extended the time limit till December 31, 2023.
Applying these extended time limits to the present case, the court observed that the impugned assessment order was passed on December 13, 2023. This date falls within the time limit as extended by the notifications, specifically the extension up to December 31, 2023, granted by the notification dated April 24, 2023, which itself followed the extension to September 30, 2023, by the notification dated July 21, 2022.
The court highlighted that the notification dated July 21, 2022, was a crucial piece of information missing in the Writ Tax No. 264 of 2024 case and its inclusion would likely have altered the outcome. The state’s counsel indicated that a review application was proposed to be filed in Writ Tax No. 264 of 2024 and similar matters based on this newly considered notification.
Given that the assessment order in the U.P. Projects Consultants Private Limited case was found to be within the extended period of limitation, the High Court concluded that the writ petition challenging the order on the ground of being time-barred was not maintainable. The court noted the availability of an alternative remedy of appeal against the assessment order.
Consequently, the Allahabad High Court dismissed the writ petition filed by U.P. Projects Consultants Private Limited, determining that the ex-parte assessment order for the Financial Year 2017-18 was not barred by time in light of the relevant notifications extending the period of limitation under Section 73(10) of the UP GST Act.
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