Delay Limit u/s 107 CGST Relaxed Where Tribunal u/s 109 Absent, GST Registration Cancellation Reconsidered

HC held that although Section 107(1) and (4) CGST Act strictly limit the appellate authority's power to condone delay to one additional month beyond the initial three-month period, rigid application of this bar in the present case would leave the petitioner remediless, as the GST Tribunal under Section 109 has not yet been constituted. Considering that the dispute concerns suo motu cancellation of GST registration for non-filing of returns, HC found that denial of any appellate scrutiny would be unjust. The impugned orders were set aside and the matter was remanded to the original authority to reconsider the petitioner's registration cancellation and pass fresh orders in accordance with law.

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Issues:
Petition seeking quashing of order-in-appeal for cancellation of GST registration due to appeal being filed beyond the extended limitation period.

Analysis:
The petitioner, a proprietorship firm engaged in works contract services in Telangana, filed a petition under Article 226 seeking to quash the order-in-appeal dated 19.04.2022, which canceled its GST registration. The appellate authority dismissed the appeal as it was filed beyond the extended limitation period. The petitioner did not approach the GST Tribunal under Section 112 of the CGST Act as it had not been constituted yet. The appellate authority's decision was based on Section 107 of the CGST Act, which allows a one-month extension for filing an appeal with sufficient cause shown by the appellant.

The High Court noted that while the appellate authority could allow filing an appeal beyond the initial three-month limitation for a further one month, it could not condone delays beyond this extended period. The Court expressed concern that the petitioner, whose GST registration was canceled due to non-filing of returns, would be left without a remedy as the GST Tribunal had not been constituted. The issue primarily revolved around the cancellation of the petitioner's GST registration, prompting the Court to remand the matter back to the authority to reconsider and pass an appropriate order in accordance with the law.

The Court decided to remand the matter without expressing any opinion on the merit, instructing the petitioner to submit all returns as per the statute when the matter is heard on remand. The writ petition was disposed of without any order as to costs, with miscellaneous applications pending to stand closed. The judgment highlighted the importance of adhering to statutory timelines for filing appeals and the necessity for a constituted GST Tribunal to provide an effective remedy in such cases.

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