Section 172 of CGST Act - Removal of Difficulties

Section 172 of the Central Goods and Services Tax Act, 2017 gave the Central Government a limited power to remove practical difficulties in giving effect to the Act. The power could be exercised only on the recommendations of the GST Council, through an order published in the Official Gazette, and subject to the conditions written into the section.

Text of Section 172 - Removal of difficulties

Meaning and scope of Section 172

The expression "removal of difficulties" refers to a limited statutory mechanism for dealing with implementation problems arising while giving effect to the CGST Act. Section 172 did not authorize the Government to make provisions inconsistent with the Act, the CGST Rules or regulations. Any order under the section therefore had to operate within the legislative framework rather than replace it.

1. A difficulty must arise in giving effect to the Act

The power was linked to an implementation difficulty concerning a provision of the CGST Act. It was not framed as a general power to amend the statute.

2. Recommendation of the GST Council was required

An order under Section 172 could be made by the Central Government only on the recommendations of the Goods and Services Tax Council. This requirement reflects the federal GST framework in which the Council makes recommendations on GST matters.

3. The order had to be published in the Official Gazette

The section contemplated either a general or special order, but publication in the Official Gazette was required. Gazette publication provides the formal public record of the exercise of the statutory power.

4. The order could not be inconsistent with the CGST Act, Rules or Regulations

This is an important statutory limitation. A removal-of-difficulties order could facilitate implementation, but the text of Section 172 expressly prevented the Government from making provisions inconsistent with the parent Act or the rules or regulations made under it.

5. The power was time-limited

The proviso imposed a three-year outer limit from the commencement of the CGST Act for making an order under Section 172. The CGST regime commenced on 1 July 2017; accordingly, the statutory removal-of-difficulties power was confined to that initial three-year implementation period.

6. Parliamentary laying requirement

Under Section 172(2), every order made under the section must be laid, as soon as may be after it is made, before each House of Parliament. This creates legislative oversight of orders issued under the provision.

Removal of Difficulties Orders under the CGST Act

During the implementation period, the Central Government used Section 172 for matters including composition levy, annual returns and other transitional or procedural difficulties. For example, Removal of Difficulties Order No. 01/2017-Central Tax dealt with implementation issues concerning the composition scheme, while later orders addressed other provisions of the CGST Act.

For authoritative material, refer to the official Central Board of Indirect Taxes and Customs (CBIC) GST portal, the Goods and Services Tax Council and the India Code portal.

Key legal takeaway

Section 172 was a temporary facilitative provision. Its safeguards were significant: an actual implementation difficulty, GST Council recommendation, Gazette publication, consistency with the Act and subordinate legislation, a three-year time limit, and laying of each order before both Houses of Parliament. These conditions should be kept in view when reading any removal-of-difficulties order issued under the CGST Act.