Notification No 29/2023 (Central Tax) dated 31st July 2023 by CBIC has sparked discussion among taxpayers, legal practitioners, and tax professionals alike. The intricate facets of this directive require a careful and extensive examination to understand its full implications.
Background and Prelude
1. Supreme Court’s Direction in Union of India v/s Filco Trade Centre Pvt. Ltd., SLP(C) No.32709-32710/2018
The Hon’ble Supreme Court’s directions in this landmark case laid the groundwork for subsequent actions by the CBIC. The Court mandated specific timelines for filing and revising Tran-1/Tran-2.
2. Circular No. 180/12/2022-GST, Dated: 09th September 2022
This circular set the stage by defining a window from 01-10-2022 to 30-11-2022 for filing or revising Tran-1/Tran-2, in line with the Supreme Court’s direction.
3. Circular No. 182/14/2022-GST, Dated: 10th November, 2022
Further building on the previous circular, it specified a 90-day period for verification of the claim by the concerned officer, up to 28-2-2023.
Para 5.3.8 of the Circular 182 is reproduced below:
“5.3.8 After considering the facts of the case, including verification report received from the counterpart officer, submissions made by the applicant and the comments, if any, of the counterpart officer on the same, the jurisdictional tax officer shall proceed to pass a reasoned order, preferably within a period of fifteen days from the date of personal hearing, specifying the amount of transitional credit allowed to be transferred to the electronic credit ledger of the applicant and upload a pdf copy of the said order, on the common portal for crediting the amount of allowed transitional credit to the electronic credit ledger of the applicant. In any case, such order shall be passed within a period of 90 days from 01.12.2022 i.e. up to 28-2-2023.”
Verification and Appeal Process
1. Verification Process
The verification needed to be carried out within 90 days after the window’s completion. A PDF copy of the order was required to be uploaded on the common portal.
2. Appeal Provisions (Section 107(1))
Any person aggrieved by an order may appeal within three months from the communication date. This meant the last date to file appeal was 28-05-2023.
3. Condonation of Delay (Section 107(4))
The Act provides for a further period of one month for delay condonation, extending the last appeal date to 28-06-2023.
Notification No 29/2023 (Central Tax) dt. 31st July 2023
In terms of Notification No 29/2023 (Central Tax) dt. 31st July 2023, Central Government, on the recommendations of the council has notified a special procedure for a registered person or an officer who intends to file an appeal against the order passed by the proper officer under section 73 or 74 of the said Act in accordance with Circular No. 182/14/2022-GST, Dated: 10th November, 2022 pursuant to the directions of the Hon’ble Supreme Court in the case of Union of India v/s Filco Trade Centre Pvt. Ltd., SLP(C) No.32709-32710/2018.
It has been mentioned that Appeal against this order shall be filed manually before the Appellate Authority in Form appended to the Notification within time specified in time specified in sub-section (1) of section 107 or sub-section (2) of section 107 of the said Act, as the case may be, and such time shall be computed from the date of issuance of this notification or the date of the said order, whichever is later.
It is important to note over here is that in any case the last date of the said order would have been 28.02.2023 which is in line with the directions of the Hon’ble Supreme Court & the Circular No. 182. So, the time limit to file appeal against this order shall begin from 31st July 2023 (date of issue of notification) or 28th February 2023 (date of said order) whichever is later, which shall always be 31st July 2023.
However, it is beyond the understanding of any taxpayer that given the sequence of all the events, when the order was passed by 28.02.2023, the last date to file appeal including the period of condonation was 28-06-2023. Those aggrieved by this order would have either manually or by means of writ already filed an appeal against this order.
How can a taxpayer who:
- Is aggrieved by this order,
- facing this limitation of not being able to file the appeal electronically on the GST portal
- within the time period specified in the law
- foresee that the Government will come up with a Notification in future that will allow manual filing of appeal in form other than APL -01
Conclusion and Recommendations
1. Need for Clarification or Amendment
The CBIC should issue a clarification or an amendment to rectify the inconsistencies and alleviate taxpayers’ concerns.
2. Enhancing Transparency and Predictability
Future notifications must be drafted with clarity, taking into account all possible scenarios, to avoid ambiguity and foster trust in the tax system.
3. Strengthening the Legal Framework
An evaluation of the existing legal framework could avoid such contradictions in the future, strengthening the overall system’s robustness.
Summary
Notification No 29/2023 (Central Tax) dt. 31st July 2023 has been a focal point of discussion due to its inherent complexities and potential impact. A timely response from the authorities to rectify the issues will be instrumental in enhancing governance effectiveness and fostering a more transparent and robust tax regime in India.
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