Welcome to yet another edition, chief!

In today’s edition — Two recent rulings explain how GST assessments and appeals should move when returns come in late or notices arrive too close for preparation. The judgments by two high courts establish there is no reason to panic if you are willing to make amends as soon as possible.

Not All Tax Delays Warrant Penalty

Vishwas Ved

Businesses dread the idea of missing GST returns or mismatched filings. Still, mistakes and delays happen, which gives sleepless nights to the finance team.

But two high court rulings this month — from Madras and Delhi — have established that there is no reason to panic as long as there is a justification for the delay and the business is willing to correct its mistakes as soon as possible.

In one case, a return was filed after the 30-day deadline had passed. But the department still sought the validity of an earlier tax assessment. 

In the other matter, an appeal by a company was rejected by the department because it arrived late, even though the hearing notices were sent with almost no time to prepare. 

Can’t Block a Return 

The first case, heard by the Madurai Bench of the Madras high court, involved a business that had not filed the GST return for August 2024. 

The GST department issued a notice and later passed a best judgment assessment under Section 62 that allows an officer to estimate tax when a return is missing.

Section 62 also includes a catch: the assessment falls away if the taxpayer files the missing return within 30 days. 

In this case, the return did come in, just not within that period. The department claimed that the delay meant that their assessment was valid.

The court did not agree with the view. It said the 30-day line helps the officer administer the provision, but doesn’t block a return that arrives later. 

With the return now on record, the earlier assessment had no validity. The department, the court said, can still review the figures and issue a fresh notice if the numbers raise questions. 

Appeal Dismissed For Delay

The Delhi matter involved Arjun Engineering, which received a ₹3.3 lakh demand after officers found gaps in its GSTR-3B, GSTR-2A and GSTR-1 data. 

The firm wanted to appeal, but its lawyer fell ill and hearing notices arrived with only a day’s time left. As a result, the company could not respond in time. Therefore, the appeal was filed late and was dismissed on that ground.

The court agreed that the tax officer has no authority to accept late appeals. However, it also noted that the company never received a real chance to appear because the notices were issued at the last moment. 

A one-day notice, the court said, is not a meaningful opportunity. 

Because the delay was on account of the short notices and the lawyer’s illness, the court allowed the appeal to be revived. 

Final Words

The two rulings show how the GST Act handles situations where the taxpayer eventually responds, even if not within the preferred timeline. 

A late return triggers a specific outcome under Section 62, and a hearing notice must allow enough time for proper participation. 

At the same time, taxpayers also need to keep in mind that once they make the correction the law expects, the next steps should follow what the Act prescribes. 

And in case the rule denies someone a meaningful opportunity, courts are willing to step in and set it right.

$30

The international crude benchmark, Brent, could dip to the $30s per barrel handle by 2027 as oversupply could overwhelm the market, according to a JP Morgan forecast. That dynamic could continue through 2027, according to JP Morgan strategist Natasha Kaneva. Oil companies are pumping out crude at a record rate, and demand can’t keep up. And if it continues, prices could fall into the $30s per barrel by the end of 2027, about half of what they are worth today.

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ICYMI | Open the Door, Terminator is Here

Missed last week's update? A cyberattack thwarted recently shows how machines can now act on their own without needing explicit instructions. What once felt like something you only saw in movies has turned into a new risk business leaders must plan for. Meanwhile, in a different corner of the world, men’s fashion has surprised us, with the tie deciding to slip into trousers. In short, machines are getting smarter, while our sartorial choices remain questionable.

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