For FY19 dues, tax officials now have until the end of April 2024, while for dues of FY20, the deadline has been extended to the end of August next year, said an order from the Central Board of Indirect Taxes and Customs (CBIC), citing the GST Council's decision.

As per the GST law, under section 73 of the Central GST Act, the prescribed time limit for recovering dues is three years from the date of filing of GST annual returns. The extension is particularly beneficial for tax officials, enabling them to take appropriate action in instances of tax discrepancies, such as underpayment of taxes, improper use of tax credits, or incorrect tax refunds by the authorities. It's important to note that this time limit does not extend to cases involving fraud, wilful misstatement, or suppression of facts.

Tax experts observed that the extension is a response to the accumulating cases with the adjudicating authority and concerns about businesses not having adequate time to provide the requested information.

"For FY19, the initial deadline of 31 March 2024 has now been extended to 30 April 2024. This extension aims to ensure that the department can provide sufficient time to taxable persons for submitting necessary information, facilitating a more thorough assessment process," said Saurabh Agarwal, tax partner, EY.

For FY20, the original deadline of 30 June 2024 has been extended to 31 August 2024. Agarwal said that this extension grants the department extra time for issuing show cause notice.