GST law. Arrest, search, summons under GST law not to be affected by Supreme Court’s limitation order, says CBIC

The Central Board of Indirect Taxes and Customs (CBIC) said that issuance of summons, search, enquiry or investigations and even consequential arrest as prescribed under GST law will not be affected by the Supreme Court’s recent order on limitation.

The extension of timelines granted by the Supreme Court order of April 27 is applicable in respect of any appeal which is required to be filed before Joint/Additional Commissioner (Appeals), Commissioner (Appeals), Appellate Authority for Advance Ruling, Tribunal and various courts against any quasi-judicial order or where proceeding for revision or rectification of any order is required to be undertaken. It is not applicable to any other proceedings under GST Laws, it said in a detailed circular dated July 20.

In an effort to provide relief on account of pandemic, the government extended time limit for various compliances under GST law. Meanwhile, on April 27, the Supreme Court restored its order dated March 23, 2020 and in continuation of the order dated March 8, directed that the period(s) of limitation, as prescribed under any general or special laws in respect of all judicial or quasi-judicial proceedings, whether condonable or not, shall stand extended till further orders.

Post this, the CBIC received representations seeking clarity on impact of this ruling. Based on the legal advice, the board came out with clarification.

CBIC’s clarification

CBIC said that the apex court has stepped in to grant extensions only with reference to judicial and quasi-judicial proceedings in the nature of appeals/suits/petitions etc. and has not extended it to every action or proceeding under the GST Law.

Accordingly, the board said that actions such as scrutiny of returns, issuance of summons, search, enquiry or investigations and even consequential arrest in accordance with GST law would not be covered by the apex court ruling. Also, issuance of show-cause notice, granting time for replies and passing orders will not be covered.

According to the board, proceedings that need to be initiated or compliances that need to be done by the taxpayers would continue to be governed only by the statutory mechanism and time limit provided/extensions granted under the statute itself. Similarly, the tax authorities can continue to hear and dispose-off proceedings where they are performing the functions as quasi-judicial authority. “This may inter-alia include disposal of application for refund, application for revocation of cancellation of registration, adjudication proceedings of demand notices, etc.,” the board said.

Similarly, appeals which are filed and are pending, can continue to be heard and disposed-off and the same will be governed by those extensions of time granted by the statutes or notifications, if any. “Wherever any appeal is required to be filed before Joint/Additional Commissioner (Appeals), Commissioner (Appeals), Appellate Authority for Advance Ruling, Tribunal and various courts against any quasi-judicial order or where a proceeding for revision or rectification of any order is required to be undertaken, the time line for the same would stand extended as per the Supreme Court’s order,” the board said.

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