Section 62 of the CGST ACT

[K Balasubramanian]

UNDULY HUGE INVOCATION OF Section 62 of the CGST Act, 2017

1. Section 62 of the CGST Act is one of the most important section which has been drafted by the LEGISLATURE in a total unbiased manner keeping the interest of the REVENUE on the one hand and the foreseeable difficulties a taxpayer may have in future on the other hand in a well-balanced manner.  To understand the implications, we need to know the sections 46 as well as 47 which are drafted for different purposes and there is no hurry to invoke 62 as the law gives five years’ time to the tax officers to take such coercive action only in cases where things continue so during the first four years.
2. The trigger for invoking Section 62 by the Adjudicating Authorities is Section 46 but Section 62 NEED NOT BE INVOKED in such a hurried manner as the law provides a huge time limit of five years to do so. In my view, the legislative intent is not to allow any registered person from running away by not filing a statutory GSTR and to facilitate the same Section 46 provides for a notice to the registered person in case he fails to furnish a return under section 39 or section 44 or section 45 requiring him to furnish such return within 15 days in ASMT 13
3. section 47 deals with late fee on delayed filing of GSTR. Thus, whenever there is any delay in payment of tax, interest is payable under section 50 and even when  there is no tax liability but only delay in filing, late fee is attracted as per section 47 irrespective of GST liability.
4. The intention of the legislature is very clear as there are provisions for sending reminder to non-filers, collection of late fee as well interest for delayed filing and delayed payment of GST. What is to be noted is that Section 62(1) is only a enabling provision providing the Adjudicating authority an opportunity to pass orders up to FIVE YEARS meaning thereby that Adjudicating Authority need not be in a hurry to pass the BEST JUDGEMENT ASSESSMENT ORDER as once notice is issued under Section 46, system captures the data and monitors. Once a notice is issued under Section 46, a registered person cannot escape from filing the required GSTR. The only issue is on cases where things are  beyond the control of the Registered Person.
5. The High Court of Madras has passed several orders holding that there is no need to pass the BEST JUDGMENT ORDER in a hurried manner as there are no MANDATORY DEADLINES to pass such orders in such a short duration. We shall refer to two such orders for the benefit of taxpayers affected by BEST JUDGEMENT ASSESSMENT ORDERS.
6. On 14/12/2023, The High Court of Madras passed orders in the case of Comfort Shoe Components V Assistant Commissioner, Vellore - 2024 (1) TMI 281 - MADRAS HIGH COURT holding that the delay in filing the GSTR is condonable.
7. The High Court of Madras passed yet another order referring to the above decision on 27/03/2025 in the case of Tvl. Solutions Online V Assistant Commissioner (ST) - 2025 (4) TMI 236 - MADRAS HIGH COURT which is reiterating that whenever there is a delay in filing the GSTR beyond the timelines set as per notice for filing such returns, such delay is CONDONABLE based on the request for condonation of delay by the registered person with justifiable reasons.
8. A question to be answered is why there is a hurry to pass the Best Judgement order when the law gives a time of FIVE YEARS for passing such orders. The fact that the time given is FIVE years should be understood in a such a manner that one need not be in a GREAT HURRY to pass the BEST JUDGMENT ASSESSMENT ORDER.
9. The original time limit which was only thirty days during 01/07/2017 till 30/09/2023 was amended as sixty days on 01/10/2023, taking into consideration the practicalities. In addition, the proviso to Section 62(2) was also inserted on 01/10/2023 to provide that over and above the first sixty days from the date of passing of the best judgement order, further sixty days (TOTAL 120 days) is available to furnish GSTR subject to additional payment of Rs. 100 per day as additional late fee for the period which is beyond 60 days.
10. It may be concluded that in order to avoid a writ before the jurisdictional high court on a procedural issue, it is worth to file the required GSTR within 120 days from the date of best judgement order. This is from the registered Person side. No useful purpose is achieved by the REVENUE as well by passing the BEST JUDGEMENT order as in majority of cases, the GSTR is being filed within 120 days from date of order under Section 62(1) which makes the original BEST JUDGEMENT order ineffective.
11. In order to reduce the litigation by way of WRITS in Jurisdictional High Courts on PROCEDURAL MATTERS which unnecessarily delay the other works of the HIGH COURT which need JUDICIAL ANALYSIS of complicated provisions of law, both the REVENUE as well as REGISTERD PERSON need to ACT SWIFTLY on Section 62 matters.