The Goods and Services Tax (GST) was introduced with strict enforcement of Section 107 of the CGST Act has triggered a major legal crisis, trapping crores of rupees in avoidable litigation. On this matter, experts were of the opinion that the law allows a rigid three-month period to appeal tax demands, with a non-extendable 30-day grace period. Once this 120-day window closes, administrative doors slam shut, leaving appellate authorities powerless to entertain appeals, regardless of the merit of the case. CMA Anil B Verma, Past Chairman ICMAI-Nagpur Chapter said that this systemic rigidity penalises genuine taxpayers heavily. Consider a business slammed with an erroneous Rs 1 crore tax demand due to a technical glitch. If the proprietor faces a sudden medical emergency or a family demise during those 120 days, the deadline is missed. Legally blocked from administrative remedies, the taxpayer is forced to file an expensive Writ Petition under Article 226 in the High Court just to get a basic hearing.

 

While High Courts increasingly step in to grant relief in genuine crises, this loop clogs the judiciary and freezes vital business capital. Verma suggested that the standard condonation window should be extended to 180 days, granting authorities discretionary power to extend it up to 365 days for exceptional, verified emergencies. “Equity must not be sacrificed for rigid timelines and administrative deadlines should not override the principles of natural justice and equity,” he added. Another prominent expert, CA Saket Bagdia, Past Chairman of ICAI, WIRC, Nagpur Branch said that to lower litigation and provide relief to genuine taxpayers the Government may allocate powers to ranks above Commissioner level to extend the tax appeal deadline and raising the tax appeal amount by 5-10 per cent in verified emergencies. “The GST Council must urgently fix this flaw. The standard appeal window should be increased to 180 days for genuine emergencies like death or severe illness. Rules should protect honest businesses, not destroy them over a missed calendar date,” he added. A leading GST expert, CA Ashwini Agrawal, Past Chairman of ICAI, WIRC, Nagpur Branch said that in order to lower the litigation’s the Government should extend the tax appeal deadline to 180 days and also frame clear-cut guidelines instead of providing discreationary powers to tax officials.