Case Law Details
Fluentgrid Limited Vs The Additional Commissioner of Central Tax and Ors (Andhra Pradesh High Court)
The Hon’ble High Court of Andhra Pradesh in the case of M/s. Fluentgrid Limited v. The Additional Commissioner of Central Tax and Ors. [Writ Petition No. 8291 of 2024 dated April 04, 2024] held that it is the ‘due date’ and not the ‘actual date’ of filing of returns which is relevant for limitation purposes, and directed that no coercive action would be taken till the next date of hearing.
M/s. Fluentgrid Limited (“the Petitioner”) filed a writ petition Order in Original dated December 20, 2023 (“the Impugned Order”). The Petitioner sought direction to adjust the payment in Special Economic Zones (“SEZ”) registration with the demand raised in DTA registration without interest and penalties or alternatively direct the Additional Commissioner of Central Tax, Central GST Commissionerate to refund the excess paid GST in SEZ registration and permit the Petitioner to remit GST in DTA registration without interest and penalty.
The Petitioner challenged the Impugned Order and the Notifications issued under section and 168A of the CGST Act, on the ground that the period of limitation of three years with effect from February 02, 2020, for passing orders for Assessment Year 2017-18 i.e. the extended period vide Notification No. 09/2023-Central Tax dated March 31, 2023 (“the Notification”).
The Hon’ble High Court of Andhra Pradesh noted that, the ground of challenge is that the initiation of the proceedings is beyond the period of limitation as also extended period as SCN was not issued in consonance with the provisions of Section 73 (2) of the CGST Act. The Impugned Order is within the jurisdiction and no tax shall be levied. Further opined that, ‘due date’ and not the ‘actual date’ of filing of returns is relevant for the limitation purposes. Lastly, held that, no cause is made out at the current stage for direction to the Petitioner to make any deposit, and till the next date of hearing no coercive action shall be taken with regard to the Impugned Order.
Conclusion: The ruling by the Andhra Pradesh High Court in the case of Fluentgrid Limited versus The Additional Commissioner of Central Tax and others underscores the importance of adherence to statutory timelines in tax proceedings. By prioritizing the ‘due date’ of filing returns, the court has provided clarity on limitation periods under the CGST Act.
This verdict not only impacts the immediate parties involved but also sets a precedent for similar cases across jurisdictions. Taxpayers and tax authorities must align their practices with this interpretation to ensure compliance and avoid legal disputes. The stay granted by the court offers temporary relief to taxpayers pending further adjudication, emphasizing the significance of procedural fairness in tax matters.
FULL TEXT OF THE JUDGMENT/ORDER OF ANDHRA PRADESH HIGH COURT
Heard Sri Venkata Prasad P, learned counsel for the petitioner and Ms.Santhi Chandra, learned Junior Standing Counsel for respondent Nos.1 to 3 & 6.
2. Sri Y.V.Anil Kumar, learned counsel has accepted notice for Respondent No.4.
3. Sri Venkata Prasad. P, learned counsel for the petitioner submits that the controversy involved in this petition is also attracting attention of this Court in various writ petitions, one of which W.P.No.6084 of 2024 for the same financial year 2017-18. He submit that same order may be passed in the present case also.
3. The following order was passed in W.P.No.6084 of 2024:-
“Heard Sri Karthik Ramana Puttamreddy, learned counsel for the petitioner and Sri Shekhar, learned Government Pleader for Commercial Tax for the respondents.
2. The petitioner is challenging the impugned order dated 27.12.2023 passed under Section 73(9) of the C.G.S.T. Act 2017, along with the show cause notice dated 28.09.2023 under Section 73(1). The challenge is on the ground that the period of limitation of three (03) years with effect from 07.02.2020 for the assessment year 2017-18, i.e. the extended period vide notification dated 03.02.2020 also expired on 07.02.2023. The impugned show cause notice and the impugned order passed under Section 73 are beyond the period of limitation which cannot be sustained being without jurisdiction. He submits that though the notification dated 31.03.2023 has been issued under Section 168A of the Act, but that would also not cover/save the present case, for limitation, as the notification itself is beyond the powers of Section 168A. The notification dated 31.03.2023 is also under challenge in the present petition. His submission is that such notification could be issued under Section 168A, only when the actions could not be completed under the Act, by „Force Majeure‟, but any such Force Majeure is not mentioned in the notification which necessitated or empowered for its issuance.
3. He further submits that the High Court of Gujarat in the case of M/s. SRSS Agro Private Limited vs. Union of India 1, High Court of Allahabad in the case of M/s. Graxiano Trasmissioni vs. Goods and Services Tax and others2 and High Court for the State of Telangana in the case of M/s. Perfetti Van Melle India Private Limited vs. Union of India and others3, under the similar circumstances, have entertained the writ petitions and the impugned show cause notices or the orders, as the case may be in those cases, have been stayed.
4. Learned Government Pleader submits that the limitation of three (03) years is to be considered from the date of actual filing of annual returns. He also prays for time to file counter affidavit.
5. The matter requires consideration.
6. Let the counter affidavit be filed within a period of four (04) weeks.
7. If counter affidavit is filed, the reply/rejoinder affidavit, if any, may be filed within a further period of two (02) weeks.
8. List on 22.04.2024.
9. Prima facie, in view of the statutory provisions and the plain language, there appears to be force in the submissions of the learned counsel for the petitioner that it is the „due date‟ and not the „actual date‟ of filing of returns which is relevant for the limitation purposes.
10. Till the next date of listing, no coercive action would be taken pursuant to the impugned order.”
4. Ms. Santhi Chandra, learned Junior Standing Counsel submits that the order is appealable under the statute and for the filing the appeal, the petitioner would be required to deposit the amount of 10% of the disputed amount. She further submits that in view thereof, the petitioner may be directed to make the payment of the amount out of the disputed amount under the impugned order.
5. We are of the view that as the ground of challenge is that initiation of the proceedings is beyond the period of limitation as also extended period as the show cause notice was not issued inconsonance in the provisions of Section 73(2) and as such the order is within the jurisdiction and no tax would be levied. No cause is made out at this stage for direction to the petitioner to make any deposit.
6. Let the counter affidavit be filed.
7. If counter affidavit is filed, the reply/rejoinder affidavit, if any, may be filed.
8. List on 22.04.2024.
9. Prima facie, in view of the statutory provisions and the plain language, there appears to be force in thoe submissions of the learned counsel for the petitioner that it is the ‘due date’ and not the ‘actual date’ of filing of returns which is relevant for the limitation purposes.
10. Till the next date of listing, no coercive action would be taken pursuant to the impugned order.
Notes:-
1 Special Civil Application No.19720 of 2023, dated 10.11.2023
2 Writ Tax No. 1256 of 2023, dated 17.11.2023
3 Writ Petition No.2123 of 2024, dated 13.01.2024
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