Section 172 of the Central Goods and Services Tax Act, 2017 deals with the power to remove difficulties that may arise while giving effect to the provisions of the CGST Act.
The provision was introduced as a transitional and enabling mechanism because the implementation of GST involved a major change in India’s indirect tax system. During the initial years of GST, practical or legal difficulties could arise in implementing particular provisions of the new law. Section 172 allowed the Government, on the recommendations of the GST Council, to address such difficulties through a general or special order, provided that the order remained consistent with the CGST Act and the rules or regulations made under it.
An important point for understanding Section 172 today is that the power was time-limited. The original Act permitted removal-of-difficulties orders for three years from the commencement of the Act. This period was subsequently extended from three years to five years by an amendment made effective from 1 July 2020. Since the CGST Act commenced on 1 July 2017, the five-year period ended on 30 June 2022. The GST Council itself recorded in 2024 that no new removal-of-difficulties order or amendment to an existing order could be issued under Section 172 after 30 June 2022.
Therefore, Section 172 remains part of the CGST Act and is important for understanding historical GST orders, but its statutory power to issue new removal-of-difficulties orders under the five-year limitation has expired.
What Is Section 172 of the CGST Act?
Section 172 is titled “Removal of difficulties.”
The provision was designed to deal with difficulties arising in giving effect to provisions of the CGST Act.
The Government could, on the recommendations of the GST Council, issue a:
- general order; or
- special order
through publication in the Official Gazette.
Such an order could make provisions that were necessary or expedient to remove the difficulty, but the provisions could not be inconsistent with:
- the CGST Act;
- the rules made under the Act; or
- the regulations made under the Act.
Why Was Section 172 Introduced?
GST came into effect on 1 July 2017 and replaced or subsumed several indirect tax systems.
The transition involved:
- new registration procedures;
- new return mechanisms;
- input tax credit provisions;
- transitional credit;
- new tax invoices;
- e-way bills;
- electronic ledgers;
- new appeal procedures;
- new compliance requirements; and
- interaction between the Central and State GST laws.
During the implementation of such a large tax system, practical difficulties were expected.
Section 172 provided a limited statutory mechanism through which the Government could address such difficulties without waiting for a formal amendment to every affected provision.
The GST Council’s records show that Section 172 was used as a mechanism for dealing with implementation difficulties in different areas of GST.
Who Could Exercise the Power Under Section 172?
The power was exercised by the Government, but it was subject to an important condition.
The order had to be made on the recommendations of the GST Council.
Therefore, the statutory framework involved:
Difficulty → GST Council recommendation → Government order → Publication in Official Gazette
The Government could not use Section 172 independently of the statutory requirement concerning the Council’s recommendation.
General Order and Special Order
Section 172 permitted the Government to issue either a general order or a special order.
General Order
A general order could address a difficulty affecting a class of taxpayers, transactions or situations.
Special Order
A special order could address a particular difficulty requiring a specific solution.
The purpose in both cases remained the same: to make provisions necessary or expedient for removing a difficulty in giving effect to the CGST Act.
What Kind of Difficulty Could Section 172 Address?
The wording of Section 172 refers broadly to a difficulty arising in giving effect to any provisions of the Act.
The provision was therefore intended to address implementation difficulties rather than create an independent taxation power.
For example, during the early implementation of GST, difficulties could arise because:
- a statutory procedure depended on a mechanism that had not yet become operational;
- a transitional provision created an unintended practical problem;
- taxpayers faced difficulty complying with a provision because of a specific implementation issue; or
- a particular statutory time limit became difficult to operate because a related institution or mechanism was not yet functional.
The GST Council’s records provide examples of Section 172 being considered and used for such implementation issues.
Section 172 Could Not Override the CGST Act
One of the most important limitations in Section 172 is that any provision made under a removal-of-difficulties order could not be inconsistent with the provisions of the Act or the rules or regulations made thereunder.
This means that Section 172 was not intended to give the Government unrestricted authority to rewrite GST law.
Its purpose was to remove a difficulty in implementing the existing statutory framework.
Therefore, a removal-of-difficulties order had to remain within the boundaries established by the Act and its subordinate legislation.
Section 172 Was Not a General Power to Amend GST Law
Section 172 should not be understood as a substitute for Parliament’s power to amend the CGST Act.
A formal amendment to the Act is a legislative process.
A removal-of-difficulties order, on the other hand, was a limited mechanism for dealing with difficulties in giving effect to the existing law.
This distinction is particularly important because Section 172 itself required that the provisions made through such an order remain consistent with the Act.
Time Limit Under Section 172
The time limit is one of the most important aspects of Section 172.
Original Time Limit
When the CGST Act was originally enacted, the proviso to Section 172(1) stated that no removal-of-difficulties order could be made after the expiry of three years from the commencement of the Act.
Since GST commenced on 1 July 2017, the original period would have ended on 30 June 2020.
Extension to Five Years
The Finance Act, 2020 amended Section 172 to extend the period from three years to five years.
The GST Council’s 40th meeting agenda specifically recorded that the amendment was intended to extend the time for issuance of removal-of-difficulties orders from three years to five years and that the amendment was to take effect from 1 July 2020.
Therefore, the final statutory period became:
1 July 2017 + 5 years = 30 June 2022
Is the Section 172 Power Still Available?
For new removal-of-difficulties orders, no.
The five-year statutory period expired on 30 June 2022.
This is not merely an inference from the date. The GST Council’s 2024 agenda expressly discussed Section 172 and stated that removal-of-difficulties orders could be issued only within five years from 1 July 2017 and that no new order or amendment to an order could be issued after 30 June 2022.
Therefore, as of 2026, Section 172 remains relevant primarily for understanding orders that were validly issued during the period in which the power was available.
Can an Old Removal-of-Difficulties Order Still Matter?
Yes.
The expiry of the power to issue new orders does not mean that every order issued before 30 June 2022 automatically disappears from legal history.
Orders that were validly issued under Section 172 during the permitted period may continue to be relevant according to their own terms and any subsequent legal developments affecting them.
For example, the GST Council has records of several removal-of-difficulties orders issued during the early GST period.
Therefore, there is an important distinction between:
Power to issue a new order under Section 172 — expired after 30 June 2022
and
Historical orders issued while that power was available — may remain relevant depending on their terms and subsequent amendments or rescission.
Section 172 and the GST Council
The GST Council played an important role in the operation of Section 172 because the Government’s power was expressly linked to recommendations of the Council.
The Council considered several implementation issues where removal-of-difficulties orders were proposed.
For example, the GST Council considered the use of Section 172 for addressing issues concerning transitional credit and preventing certain disputed or blocked credits from being wrongly availed.
This illustrates the intended purpose of the provision: dealing with practical difficulties in implementing GST rather than creating an independent tax policy framework.
Example – Transitional Credit
One example from the GST Council’s records concerned transitional credit.
The Council considered difficulties relating to:
- disputed transitional credit;
- credit blocked under Section 17(5);
- credit that was not eligible for transition; and
- preventing ineligible transitional credit from being used for payment of tax.
The Council proposed using Section 172 to issue an order dealing with those implementation difficulties.
This demonstrates how Section 172 was used during the early GST period to address practical implementation issues.
Example – Composition Scheme
The GST Council also considered a removal-of-difficulties order concerning the composition scheme.
The Council records show a proposal to issue an order extending a beneficial condition for composition taxpayers under which certain exempt services involving deposits, loans or advances, where consideration was represented by interest or discount, would not be included in aggregate turnover for the specified purpose.
The Council also considered rescinding an earlier Removal of Difficulties Order and issuing a new order for the revised position.
This is another example of Section 172 being used as part of the early implementation and refinement of GST provisions.
Example – GST Appellate Tribunal Appeals
Another important example concerns appeals to the GST Appellate Tribunal.
The GST Appellate Tribunals were not operationalised within the originally contemplated timeframe. This created a difficulty because statutory appeal periods could expire while the Tribunal mechanism was not functioning.
The Government, on the recommendation of the GST Council, issued the Central Goods and Services Tax (Ninth Removal of Difficulties) Order, 2019 dated 3 December 2019.
The order addressed the timing of appeals to the Appellate Tribunal by linking the relevant period to the date on which the President or State President of the Tribunal entered office, as applicable under the then-existing statutory framework.
This is a useful example of the practical purpose of Section 172.
Why the Tribunal Example Is Important
The Tribunal example demonstrates that Section 172 could be relevant when one GST provision could not operate effectively because another institutional or procedural mechanism was not yet functioning.
The difficulty was not necessarily that the substantive tax rule was unclear.
Instead, the problem concerned how to give practical effect to the statutory appeal mechanism while the Tribunal was not operational.
Section 172 provided a temporary mechanism for dealing with that difficulty within the limits of the statutory power.
Section 172 and COVID-19 Related Difficulties
The GST system also faced significant operational difficulties during the COVID-19 period.
Various GST provisions had to operate against a background of lockdowns, disrupted business operations and difficulties in completing statutory procedures.
However, it is important not to assume that every COVID-related GST extension was issued under Section 172. Different statutory powers, notifications, rules and specific legislative amendments were also used.
Therefore, a particular extension should always be traced to its actual legal instrument rather than automatically attributed to Section 172.
Section 172 and Removal of Difficulties Orders
A Removal of Difficulties Order is the instrument issued under the statutory power.
Such an order generally identifies:
- the statutory provision creating the difficulty;
- the difficulty that needs to be addressed;
- the provision or modification necessary to remove the difficulty; and
- the legal authority under which the order is issued.
The order is then published through the appropriate official Gazette mechanism.
Section 172 Is Different From Section 164
Section 164 of the CGST Act deals with the power of the Government to make rules.
Section 172, in contrast, deals with the removal of difficulties.
The two provisions serve different purposes.
| Provision | Subject |
|---|---|
| Section 164 | Power to make rules |
| Section 172 | Removal of difficulties |
Rules made under Section 164 are subordinate legislation made under the rule-making power.
Section 172 was a limited transitional mechanism intended to resolve difficulties in giving effect to the Act.
Section 172 Is Different From Section 168
Section 168 deals with the power to issue instructions or directions.
Section 168 allows the Board or specified authorities to issue instructions or directions for the purpose of uniformity in implementation of the Act.
Section 172 was different because it specifically allowed the Government, on the recommendations of the GST Council, to make provisions by general or special order to remove difficulties.
Therefore:
Section 168 → Instructions and directions
Section 172 → Removal of difficulties
Neither provision should automatically be treated as a general power to amend the CGST Act.
Section 172 and Section 173
Section 173 deals with amendments to certain other laws consequential to the CGST framework.
Section 172 is specifically concerned with removing difficulties in giving effect to the CGST Act.
They therefore perform different functions within the final provisions of the CGST Act.
Section 172 and Section 174
Section 174 contains the repeal and saving provisions of the CGST Act.
Section 172, on the other hand, concerns removal of implementation difficulties.
The two provisions should not be confused simply because they appear near each other in the final chapter of the Act.
What Does “Giving Effect to Any Provisions” Mean?
The wording of Section 172 focuses on difficulties arising in giving effect to provisions of the Act.
This language is significant.
The provision was intended to facilitate implementation of the statutory framework.
It was not framed as a general power to make any policy decision considered desirable by the Government.
The order must address a difficulty connected with giving effect to the Act and must remain consistent with the Act, rules and regulations.
Can Section 172 Be Used to Create a New Tax?
Section 172 should not be understood as an independent power to impose a new tax contrary to the Act.
The provision expressly requires that measures made to remove difficulties must not be inconsistent with the CGST Act or its rules or regulations.
A removal-of-difficulties order therefore operates within the statutory framework rather than replacing the legislative framework.
Can Section 172 Override a Statutory Provision?
The provision does not authorise an order that is inconsistent with the Act.
Therefore, Section 172 should not be treated as an unrestricted power to override the substantive provisions of the CGST Act.
Where Parliament has prescribed a particular statutory rule, a removal-of-difficulties order must operate within the boundaries permitted by Section 172.
Importance of Official Orders
When researching a historical GST issue involving Section 172, it is important to identify the exact Removal of Difficulties Order rather than relying solely on secondary explanations.
The relevant order should be checked for:
- order number;
- date;
- section affected;
- operative language;
- effective date;
- duration;
- subsequent amendments; and
- whether it was rescinded or superseded.
The GST Council’s published records provide examples of such orders and the difficulties that led to their consideration.
Practical Compliance Approach
Although the power to issue new Section 172 orders has expired, the provision remains relevant when researching historical GST compliance.
A taxpayer or professional examining an old GST issue should follow these steps:
1. Identify the Relevant Section
Determine which CGST Act provision created the difficulty.
2. Search for a Removal-of-Difficulties Order
Check whether the Government issued an order under Section 172 concerning that provision.
3. Check the Date
Determine whether the order was issued during the statutory five-year period ending on 30 June 2022.
4. Read the Exact Order
Do not rely solely on summaries. The operative wording of the order should be examined.
5. Check Subsequent Changes
Verify whether the order was:
- amended;
- rescinded;
- superseded; or
- affected by a later amendment to the Act.
6. Check Current Law
An old removal-of-difficulties order cannot be examined in isolation. The current statutory provision and subsequent amendments must also be considered.
Section 172 – Key Features
| Feature | Details |
|---|---|
| Section | 172 of the CGST Act, 2017 |
| Title | Removal of difficulties |
| Purpose | To address difficulties in giving effect to provisions of the Act |
| Authority | Government |
| Condition | Recommendation of the GST Council |
| Form | General or special order |
| Publication | Official Gazette |
| Limitation | Order could not be made after five years from commencement after the 2020 amendment |
| GST commencement | 1 July 2017 |
| Final date for new orders | 30 June 2022 |
| Limitation today | New Section 172 orders cannot be issued under the expired five-year power |
| Important restriction | Order cannot be inconsistent with the Act, rules or regulations |
The five-year limitation and its expiry are expressly discussed in GST Council records.
Section 172 – Important Historical Orders
Section 172 has been associated with a number of important GST implementation orders.
Some examples include:
- Central Goods and Services Tax (Ninth Removal of Difficulties) Order, 2019, relating to appeals to the GST Appellate Tribunal while the Tribunal mechanism was not operational.
- Removal-of-difficulties measures relating to certain transitional credit issues considered by the GST Council.
- Orders concerning implementation of the composition scheme and aggregate turnover treatment of specified exempt services.
- The Central Goods and Services Tax (First Removal of Difficulties) Order, 2020, which provided a temporary solution concerning revocation of cancellation of registration in specified cases affected by the COVID-19 period.
These examples show that Section 172 had practical importance during the formative years of GST.
What Changed in 2020?
The Finance Act, 2020 made an important change to Section 172.
The original three-year period was extended to five years.
The GST Council’s 40th meeting material specifically states that the amendment to Section 172 was intended to extend the time for issuing removal-of-difficulties orders from three years to five years and that the amendment was to come into force from 1 July 2020.
This gave the Government additional time to address implementation difficulties during the initial GST period.
What Happened After 30 June 2022?
After the expiry of the five-year period, Section 172 could no longer be used to issue a new removal-of-difficulties order or amend an existing order under that provision.
This limitation became particularly relevant when the GST Appellate Tribunal framework was being operationalised.
In 2024, the GST Council considered the difficulty concerning the filing period for appeals before the Tribunal and expressly noted that Section 172 could no longer be used because the five-year period had expired. It therefore considered amendment of Section 112 instead of issuing a fresh removal-of-difficulties order.
This provides a clear example of the continuing relevance of the time limitation.
Why Section 172 Is Still Important in 2026
Even though the power to issue new orders has expired, Section 172 remains important for several reasons.
Historical GST Research
Many important early GST implementation measures were issued under Section 172.
Interpretation of Old Transactions
A dispute involving an earlier financial year may require checking the Removal of Difficulties Orders applicable at that time.
Understanding GST Development
The provision explains how the GST framework was adjusted during its initial implementation.
Legal Due Diligence
Professionals reviewing historical GST positions may need to determine whether a particular government order was issued under Section 172 and whether it remained operative for the relevant period.
Section 172 and Current GST Compliance
For a current GST compliance issue in 2026, a taxpayer should not assume that the Government can issue a fresh Section 172 order to solve a new difficulty.
The statutory five-year window expired on 30 June 2022.
If a new difficulty arises today, the Government would need to rely on whatever other statutory or legislative mechanism is legally available, depending on the nature of the issue.
The GST Council itself recognised this limitation when discussing amendments needed in 2024 for the GST Appellate Tribunal appeal mechanism.
Difference Between Section 172 and a Notification
A notification issued under a specific enabling provision of the CGST Act and a Removal of Difficulties Order under Section 172 are not automatically the same type of legal instrument.
A notification generally exercises a power expressly provided by a particular section, such as an exemption or prescribed condition.
A Section 172 order was specifically concerned with removing difficulties in giving effect to the Act.
Therefore, when researching a GST provision, it is important to identify the legal authority under which the Government issued the particular instrument.
Difference Between Section 172 and an Amendment Act
An amendment Act changes the text of the statute through the legislative process.
A Section 172 order was an executive mechanism operating within a statutory delegation and subject to the limitations specified in Section 172.
Therefore:
| Basis | Amendment Act | Section 172 Order |
|---|---|---|
| Nature | Legislative amendment | Removal-of-difficulties measure |
| Authority | Parliament | Government on GST Council recommendation |
| Scope | Can amend statute subject to constitutional requirements | Cannot be inconsistent with CGST Act/rules/regulations |
| Purpose | Change statutory law | Remove implementation difficulty |
| Section 172 time limit | Not applicable | Five-year window expired 30 June 2022 |
Key Takeaways of Section 172
Section 172 can be understood through the following points:
- Section 172 is titled Removal of difficulties.
- It was introduced to address difficulties in giving effect to the CGST Act.
- The Government could issue a general or special order.
- Such an order required recommendations of the GST Council.
- The order had to be published in the Official Gazette.
- The order could contain provisions necessary or expedient to remove the difficulty.
- Such provisions could not be inconsistent with the CGST Act.
- They also could not be inconsistent with the rules or regulations made under the Act.
- The original statutory period was three years from commencement of the Act.
- The Finance Act, 2020 extended the period to five years.
- GST commenced on 1 July 2017.
- The five-year period ended on 30 June 2022.
- Therefore, no new Section 172 removal-of-difficulties order can be issued after that date under the expired statutory power.
- The GST Council expressly recognised this limitation in its 2024 discussions.
- Historical Section 172 orders may still be relevant when dealing with the periods and matters to which they applied.
- Section 172 was used for various GST implementation difficulties, including issues concerning transitional credit, composition provisions and GST Appellate Tribunal appeals.
- Section 172 is different from the rule-making power under Section 164.
- Section 172 is also different from the instruction and direction power under Section 168.
- A Section 172 order could not be used as an unrestricted mechanism to override the CGST Act.
- For current GST issues, taxpayers should verify the current statutory provision and the specific legal instrument applicable to the issue rather than assuming that Section 172 can still be invoked.
Conclusion
Section 172 of the CGST Act was an important transitional mechanism for removing difficulties in implementing GST. It allowed the Government, on the recommendations of the GST Council, to issue general or special orders through the Official Gazette where difficulties arose in giving effect to the provisions of the CGST Act. The measures made under such orders had to remain consistent with the Act, rules and regulations.
The provision became particularly relevant during the early years of GST because the new tax system involved major changes in registration, returns, input tax credit, transitional provisions, appeals and electronic compliance. GST Council records show that Section 172 was considered or used for several implementation issues, including transitional credit, composition scheme provisions and difficulties concerning appeals to the GST Appellate Tribunal.
An important change occurred in 2020 when the statutory period for issuing removal-of-difficulties orders was extended from three years to five years. As GST commenced on 1 July 2017, the extended period ended on 30 June 2022. The GST Council expressly recorded in 2024 that no new Removal of Difficulties Order, or amendment to an existing order, could be issued under Section 172 after that date.
Accordingly, Section 172 should now be understood primarily as a historical and interpretative provision for the GST implementation period. Its expired power should not be confused with the Government’s other statutory powers under provisions such as Sections 164 and 168.
For taxpayers, tax professionals and researchers dealing with historical GST matters, Section 172 can still be important because a Removal of Difficulties Order issued during the permitted period may have affected the operation of a particular provision for a particular period. The exact order, date, operative language and subsequent amendments or rescission should therefore be checked whenever Section 172 is relevant.
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