The Madras High Court has granted an interim stay on a GST rectification order after a taxpayer argued that it was issued beyond the six-month limitation period prescribed under Section 161 of the GST law.
The bench of Justice Krishnan Ramasamy passed the interim order after considering the taxpayer’s submission that the Commercial Tax Officer had issued the rectification order 115 days after the expiry of the applicable limitation period.
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The taxpayer also argued that, following a review order issued by the Deputy Commissioner, the tax officer should have filed an appeal before the first appellate authority instead of rectifying the original order.
The High Court has directed that the matter be listed after eight weeks for the filing of the department’s counter. The court has granted interim relief; it has not yet finally decided whether the rectification order is time-barred.
The petitioner, Arasan Agencies, challenged a rectification order dated September 9, 2026, issued by the Commercial Tax Officer, Virudhachalam Assessment Circle.
According to the petitioner, the officer had initiated suo motu rectification proceedings under Section 161 of the GST Act in respect of an earlier order dated November 17, 2025.
The rectification order followed a review order dated July 30, 2026, issued by the Deputy Commissioner under Section 107(2) of the GST Act.
The petitioner’s counsel submitted that the September 2026 rectification order was barred by limitation. The taxpayer contended that the order was passed 115 days after the expiry of the six-month period.
The petitioner also questioned the procedure adopted by the department. It argued that once the Deputy Commissioner issued the review order under Section 107(2), the Commercial Tax Officer should have pursued an appeal before the first appellate authority.
According to the petitioner, no such appeal was filed, and the officer instead passed the challenged rectification order. On these grounds, the taxpayer sought an interim stay.
After considering the submissions made on behalf of the petitioner, Justice Krishnan Ramasamy ordered an interim stay of the rectification order.
The court directed that the matter be posted after eight weeks for the department to file its counter. The short interim order does not record a final finding on the limitation objection or on whether the department was required to proceed by way of an appeal.
Section 161 of the GST law deals with rectification of errors apparent on the face of the record. It generally provides a six-month time limit for rectification, subject to the provisions and exceptions contained in the section.
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