M/S. Sri Sai Steels, vs The State Of Andhra Pradesh, on 9 January, 2025

Summary of High Court Order

Title: M/S. Sri Sai Steels, vs The State Of Andhra Pradesh, on 9 January, 2025

Note: This document is not a final judgment but a procedural order for a batch of 35 writ petitions heard together. The title refers to one of the petitioners in this batch (WP No. 24694 of 2024). The order adjourns the hearing and extends interim relief.

1. Outcome

The High Court adjourned the hearing for the entire batch of writ petitions to April 24, 2025, due to a lack of time. It was directed that any interim orders previously granted in these matters shall continue to be in effect until the next hearing date. No final decision was made on the merits of the cases.

2. Core Issue

The central legal question across all petitions is the constitutional and statutory validity of notifications issued by the Central and State Governments under Section 168-A of the CGST/SGST Acts, 2017. These notifications extended the statutory time limits for the tax authorities to issue demand orders under Section 73 for the financial years 2017-18, 2018-19, and 2019-20.

Consequently, the petitioners challenge the legality of the Show Cause Notices (SCNs) and assessment/demand orders issued against them, arguing they are barred by the original, un-extended period of limitation.

3. Key Facts

• The petitioners are all registered taxpayers who have been issued SCNs or assessment/demand orders by GST authorities for various financial years (primarily 2017-18, 2018-19, 2019-20).
• The Government, invoking its powers under Section 168-A of the GST Acts, issued notifications (e.g., Notification No. 09/2023-Central Tax, Notification No. 56/2023-Central Tax) and corresponding State G.O.s.
• These notifications extended the deadline for issuing orders under Section 73(10) of the GST Acts, citing difficulties arising from the COVID-19 pandemic.
• The impugned SCNs and orders were issued within the extended timelines but after the expiry of the original statutory deadlines.
• The petitioners filed writ petitions challenging the validity of these extensions and the consequential actions taken by the tax authorities.

4. Arguments

(Synthesized from the prayers of the various writ petitions listed in the order)

Petitioners' Arguments:
* Ultra Vires: The notifications extending the time limits are ultra vires Section 168-A of the CGST/SGST Acts. The power under this section is meant for exceptional force majeure events (like war, epidemic, flood) that make compliance impossible, not for addressing administrative delays.
* Arbitrariness: The repeated extensions are manifestly arbitrary, unreasonable, and violate the fundamental right to equality under Article 14 of the Constitution.
* Barred by Limitation: As the notifications are illegal, the original time limits prescribed under Section 73(10) apply. Therefore, the assessment orders and SCNs issued after these original dates are barred by limitation and are without jurisdiction.
* Other Grounds (in some petitions):
* Challenge to the constitutional validity of Section 16(2)(c) (tax paid by supplier for ITC eligibility) and Section 16(4) (time limit for claiming ITC).
* Allegations of violation of the principles of natural justice during the assessment proceedings.

Respondents' Arguments:
* The provided order does not contain the arguments of the Respondents (Union of India, State of Andhra Pradesh, GST Council, etc.).

5. Court’s Reasoning

The provided text is a procedural order, not a final judgment. The Court did not provide any reasoning on the merits of the core issue. The only reason cited in the order was for the adjournment of the hearing, which was a "paucity of time." The Court has listed the matters for a future date to hear arguments.

6. Statutory References

• Central Goods and Services Tax (CGST) Act, 2017 / Andhra Pradesh GST (APGST) Act, 2017:
  • Section 16(2)(c) & 16(4) - Conditions for availing Input Tax Credit (ITC).
  • Section 73 & 73(10) - Determination of tax not paid where there is no fraud.
  • Section 74 - Determination of tax not paid by reason of fraud.
  • Section 168-A - Power of Government to extend time limits in special circumstances.
• Constitution of India:
  • Article 14 (Right to Equality)
  • Article 19(1)(g) (Freedom to practice any profession, or to carry on any occupation, trade or business)
  • Article 226 (Power of High Courts to issue certain writs)
  • Article 265 (Taxes not to be imposed save by authority of law)
• Notifications & Government Orders (G.O.s):
  • Notification No. 09/2023-Central Tax, dated 31.03.2023
  • Notification No. 56/2023-Central Tax, dated 28.12.2023
  • G.O. Ms. No. 221 (Andhra Pradesh), dated 17.05.2023
  • G.O. Ms. No. 2 (Andhra Pradesh), dated 03.01.2024

7. Precedents Cited

The text of the order mentions the following precedent being cited in the grounds of some of the writ petitions:
* India Cements Ltd. vs. Collector of Central Excise, (1990) 1 SCC 12.