Can GST Limitation Periods Be Retrospectively Extended Without GST Council Recommendation? Punjab & Haryana HC Examines Scope of Section 168A

The Punjab and Haryana High Court has examined the legality and scope of notifications issued by the Centre and the State of Punjab extending limitation periods for passing GST orders by invoking Section 168A of the Central Goods and Services Tax (CGST) Act, 2017. The bench of Justice Sanjeev Prakash Sharma And Justice Sanjay Vashisth has closely analysed the structure of Section 168A and held that the provision is an exceptional power meant to deal with extraordinary situations such as pandemics, natural calamities, or other force majeure events. It noted that the power to extend limitation is not automatic or unlimited and must strictly satisfy the conditions laid down in the statute. The bench noted certain notifications were merely “ratified” by the GST Council after issuance, rather than being issued on its prior recommendation. It observed that ratification is not the same as recommendation and that policy decisions under the GST framework must follow the procedure prescribed by law. The writ petitions were led by Garg Rice Mills, where taxpayers challenged the retrospective extension of timelines for completing assessments and adjudication proceedings. The petitions arose after the Central Board of Indirect Taxes and Customs (CBIC) and the State of Punjab issued a series of notifications extending the time limit for passing adjudication orders under Section 73 of the CGST/PGST Acts for earlier financial years, including FY 2017–18. These extensions were granted by invoking Section 168A, a provision introduced during the COVID-19 pandemic to empower the government to extend timelines in situations of “force majeure.” Taxpayers contended that several of these notifications were issued after the original limitation period had already expired and were given retrospective effect without proper legal authority or recommendation of the GST Council. The High Court was primarily called upon to examine whether Section 168A permits retrospective extension of limitation for adjudication proceedings once the original statutory period has expired. Whether notifications extending limitation under Section 168A require prior recommendation of the GST Council. Whether such extensions can be justified in the absence of continuing force majeure conditions, particularly long after the COVID-19 pandemic. Whether notifications issued by the CBIC, as opposed to the “Government,” were legally valid under Section 168A. The Court closely analysed the structure of Section 168A and held that the provision is an exceptional power meant to deal with extraordinary situations such as pandemics, natural calamities, or other force majeure events. It noted that the power to extend limitation is not automatic or unlimited and must strictly satisfy the conditions laid down in the statute. Importantly, the Court emphasised that section 168A(1) mandates that any extension of time must be based on the recommendation of the GST Council. Section 168A(2), which permits retrospective effect, cannot be read in isolation and does not independently authorise retrospective extensions without satisfying the preconditions of Section 168A(1). The Court expressed serious reservations about notifications that sought to revive limitation periods after they had already lapsed, particularly when such extensions were issued years after the pandemic and without demonstrable force majeure conditions. The Court noted that the GST Council is not a mere rubber stamp and that its recommendation is a mandatory precondition for exercising powers under Section 168A. The Court questioned the jurisdiction of the CBIC to issue notifications under Section 168A, observing that the statute vests such power in the “Government” and not in the Board. With respect to notifications issued by the State of Punjab, the Court examined whether Section 168A was even in force in the State on the dates from which retrospective effect was claimed. It was noted that Section 168A was inserted into the Punjab GST Act only later, raising serious doubts about the validity of retrospective extensions granted for periods when the provision itself was not in existence. The Court indicated that retrospective extensions without GST Council recommendation and without statutory backing were vulnerable to being struck down. Case Details Case Title: M/S GARG RICE MILLS AND OTHERS V/S STATE OF PUNJAB & ORS. Case No.: CWP-1138-2024 (O&M) Date: 12/03/2025 Counsel For Petitioner: Puneet Bali, Sr. Advocate Counsel For Respondent: Saurabh Kapoor, Addl. AG Click Here To Read Order Read More: GST Adjudication Order Invalid If Based on Grounds Not Raised in SCN: Calcutta HC

Can GST Limitation Periods Be Retrospectively Extended Without GST Council Recommendation? Punjab & Haryana HC Examines Scope of Section 168A

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