Implications of SC Extension Order on due dates of filing GST refund applications

by | Mar 31, 2022 | Outlook

Amidst Covid-19, the Supreme Court vide its Order dated March 23, 2020 extended limitation period for all judicial or quasi-judicial proceedings effective March 15, 2020 till further orders. Vide subsequent orders, the Supreme Court extended limitation period further. Basis last Order dated January 10, 2022 (‘Supreme Court Extension Order’), revised extended timelines are as under:

  • Period from March 15, 2020 to February 28, 2022 will be excluded for computing limitation period in all judicial or quasi-judicial proceedings.
  • Balance limitation period will be counted from March 1, 2022. If balance limitation period is less than 90 days from March 1, 2022, 90 days will be counted from March 1, 2022 else actual balance period will be considered.

This extension was irrespective of period prescribed under General or Special Laws and despite period being condonable or not.

Specific Relaxation under GST Law

In parallel, the Central Government issued series of Notifications extending time limit for completion of various actions under the GST law in terms of powers granted under Section 168A of the CGST Act.

The applicability of both Supreme Court Extension Order and GST Notifications (with shorter extension period) on same actions created ambiguity as to how limitation period would be computed for actions under GST Law.

In 43rd GST Council Meeting, this issue was deliberated and Press Release dated May 28, 2021 specifically clarified that timelines for actions as extended by the Supreme Court Extension Order would prevail over extensions granted under the CGST Act. Subsequently, CBIC vide Circular No. 157/13/2021-GST dated July 20, 2021 (‘Circular’) clarified that Supreme Court Extension Order is applicable to limited cases of filing appeals and not to other actions under GST law. Vide NITYA Outlook | Issue 63 | Implications of SC Orders on limitation period dated June 18, 2021, we discussed this anomaly in detail.

As a corollary, taxpayers started witnessing rejection of GST refund applications filed beyond limitation prescribed under GST law but within extended period as per the Supreme Court Extension Order. Many taxpayers challenged rejection of such refund applications before the High Courts.

Vide this outlook, we are summarizing stand being taken by High Courts on such refund applications and way forward for taxpayers.

The High Courts[1] in multiple cases held that benefit of Supreme Court Extension Order will be available for filing refund applications under Section 54 of the CGST Act. The Courts held that Revenue is bound by Supreme Court Extension Order and needs to exclude said period while computing period of limitation.

NITYA Comments:

Taxpayers should consider filing refund applications basis relaxation in limitation period provided by Supreme Court Extension Order wherein statutory limitation period of 2 years has expired. In our view, the Supreme Court Extension Order will apply to all judicial or quasi-judicial proceedings and cover petitions, SCNs, filing of appeals, refund applications etc. under all Laws including GST Law.

For ease of understanding, let’s take illustrations computing last date of filing refund application.

Relevant Date for computation of 2 years under Section 54

Last date to file refund application under Section 54

Balance period covered during extended period (March 15, 2020, to February 28, 2022)

Last date basis Supreme Court Extension Order

March 20, 2018

March 19, 2020


May 30, 2022*

April 20, 2019

April 19, 2021


April 5, 2023**

 *Since balance period is less than 90 days, last date shall be calculated by adding 90 days to March 1, 2022.

**Since balance period exceeds 90 days, last date shall be calculated after adding actual balance period i.e. 400 days to March 1, 2022.

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[1] Gamma Gaana v. UOI, 2022-VIL-199-ALH; A.G Exports v. ACST, 2022-VIL-149-AP; Saiher Supply Chain Consulting Private Limited v. UOI, 2022-VIL-29-BOM; GNC Infra LLP v. AC, 2021-VIL-856-MAD