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Dear Professional Colleagues,

Greetings of the Day !

Central Board of Indirect Taxes and Customs had issued Circular No. 185/17/2022-GST dated December 27, 2022, regarding clarification with regard to the applicability of provisions of section 75(2) of Central Goods and Services Tax Act, 2017 and its effect on limitation.

Background

Section 75(2) provides that in cases where the appellate authority or appellate tribunal or court concludes that the notice issued by the proper officer under section 74(1) is not sustainable for reason that the charges of fraud or any willful-misstatement or suppression of facts to evade tax have not been established against the person to whom such notice was issued, then the proper officer shall determine the tax payable by the noticee, deeming as if the notice was issued under section 73(1).

Issues clarified

• In cases where any direction is issued by the appellate authority or appellate tribunal or the court to re-determine the amount of tax payable by the noticee by deeming the notice to have been issued under section 73(1)in accordance with the provisions of section 75(2), the proper officer is required to issue the order of redetermination of tax, interest, and penalty payable within a period of two years from the date of communication of the said direction by appellate authority or appellate tribunal or the court, as the case may be.

• In case, where the show cause notice under sub-section (1) of section 74 was issued for tax short paid or tax not paid or wrongly availed or utilized input tax credit beyond a period of 2 years and 9 months from the due date of furnishing of the annual return for the financial year to which such demand relates to, and the appellate authority concludes that the notice is not sustainable under sub-section (1) of section 74 of CGST Act thereby deeming the notice to have been issued under sub-section (1) of section 73. The entire proceeding shall have to be dropped, being hit by the limitation of time as specified in section 73. Similarly, where show cause notice under sub-section (1) of section 74 of CGST Act was issued for erroneous refund beyond a period of 2 years and 9 months from the date of erroneous refund, the entire proceeding shall have to be dropped.

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AMRG Team

About Us

AMRG & Associates is an established Chartered Accountants firm. It came into existence in 1984 and since then has grown its branches across major Indian cities such as Delhi, Mumbai and Chandigarh. Since its inception, it has become one of the leading chartered accountants’ firms in North India. AMRG & Associates offers its clients a wide range of exceptional services through the expertise of its highly motivated group of trained professionals. The firm provides expertise in financial and business advisory, tax and regulatory, audit and assurance and risk advisory services.

AMRG & Associates has a client base of 200+ companies & individuals. The firm's approach to service delivery helps to provide value-added services to its wide clientele. Our differentiation is derived from a rapid performance based, industry-tailored and technology-enabled business advisory services delivered by talented professionals in the country.

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© -2022 AMRG & Associates All Rights Reserved. This document has been written for the general interest of our clients and professional colleagues and is subject to change. This document is not to be construed as any form of solicitation. It is not intended to be exhaustive or a substitute for legal advice. We cannot assume legal liability for any errors or omissions. Specific advice must be sought before taking any action pursuant to this document.

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