The Calcutta High Court has held that an adjudication order issued under Section 73 of the CGST/WBGST Act does not become time-barred merely because it was uploaded on the GST portal after the statutory limitation period, provided the order was duly issued within the prescribed time.
The bench of Justice Raja Basu Chowdhury clarified that the statutory limitation under Section 73(10) applies to the issuance of the order and not to its subsequent service or communication through the GST portal.
The dispute arose from proceedings initiated through a show cause notice issued under Section 73(1) of the GST Act for the tax period April 2018 to March 2019. After adjudication, the proper officer digitally signed the order under Section 73(9), which was the last day of the extended limitation period notified by the Government under Section 168A of the Act. However, the summary of the order in Form GST DRC-07 was uploaded on the GST portal only on 1 May 2024.
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Although the taxpayers had already challenged the order before the appellate authority on merits, they subsequently approached the High Court contending that the adjudication order itself was without jurisdiction since it was uploaded after expiry of the limitation period.
The petitioners argued that an adjudication order under Section 73 becomes legally effective only upon being uploaded and made available on the GST portal in accordance with Rule 142(5) read with Section 169 of the GST Act.
According to them the statutory time limit for issuing orders relating to FY 2018-19 had been extended only up to 30 April 2024; since the DRC-07 summary was uploaded on 1 May 2024, the order was effectively issued beyond limitation; merely digitally signing the order before expiry of limitation could not validate it unless it was also communicated to the taxpayer within the prescribed period; reliance was placed on several Income Tax judgments, including Daujee Abhushan Bhandar Pvt. Ltd., which held that mere digital signing without dispatch or communication does not amount to issuance of notice.
The petitioners therefore sought quashing of the entire adjudication proceedings as being barred by limitation.
The State Government opposed the writ petition, submitting that the adjudication order had admittedly been digitally signed on 30 April 2024 at about 9:15 PM, well within the extended statutory period.
It argued that Section 73 requires only that the order be issued within limitation; Section 169 merely prescribes the mode of service of orders and notices; uploading the order on the portal the following day constituted only the method of communication and did not affect the validity of the order already issued within time.
The State also distinguished the Income Tax decisions relied upon by the petitioners by pointing out that the statutory scheme under the GST Act materially differs from the Income Tax Act.
The Court appointed Senior Advocate Sudhir Kumar Mehta as amicus curiae, who analysed the statutory framework in detail.
The amicus explained that an order under Section 73 passes through three distinct stages: making of the order; issuance of the order; and communication or service of the order.
Each stage serves a separate legal function and should not be conflated while interpreting the limitation provisions under the GST Act.
The Court undertook a detailed examination of Sections 73 and 169 of the GST Act together with Rule 142 of the GST Rules.
The court observed that the legislature consciously used the expressions “issue” and “serve” differently. While Section 73 repeatedly requires the proper officer to issue notices and adjudication orders within prescribed timelines, Section 169 separately governs the service of decisions, notices and orders by various modes, including: registered or speed post; email; publication; and making the order available on the common GST portal.
The Court noted that uploading the order on the portal is only one of several permissible methods of service under Section 169 and is not synonymous with issuance of the order itself.
The Court held that the GST legislation deliberately separates the concepts of issuance and service.
According to the judgment issuance refers to completion of the adjudicatory function by the proper officer through signing and formally issuing the order; service concerns communication of that order through one of the statutory modes prescribed under Section 169.
The Court held that nothing in Section 73 requires service of the order to be completed within the limitation period.
It further observed that Rule 142, which requires uploading of a DRC-07 summary, relates to recovery proceedings and procedural communication, and does not alter the statutory meaning of issuance under Section 73.
The High Court distinguished the Income Tax precedents cited by the petitioners, including those concerning reassessment notices under Section 148 of the Income Tax Act.
It observed that the statutory schemes under the Income Tax Act and GST Act are materially different; earlier tax statutes such as the Finance Act, 1994 and Central Excise Act emphasised service within limitation, whereas the GST Act intentionally uses the expression issue; courts cannot import interpretations from other taxing statutes where the legislature has adopted a different statutory framework.
The Court also relied upon Supreme Court decisions recognising the distinction between issuance and service where the statute specifically employs different terminology.
The Court held that an adjudication order issued within the prescribed limitation remains valid even if it is served or uploaded after expiry of the limitation period; the limitation prescribed under Section 73(10) applies only to the issuance of the order and not to its communication or service; making an order and serving it are two legally distinct acts under the GST framework; uploading the DRC-07 summary on the GST portal on the following day does not invalidate an order already issued within limitation.
Accordingly, the writ petition was dismissed.Â
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