2022 (8) TMI 631 - HC - GST

CGST appeal time limits u/ss 107(1) and 107(4) exclude Limitation Act; appeal dismissed as time-barred

Whether the Limitation Act governs appeals under the CGST Act: the court held that Section 29(2) of the Limitation Act preserves special/local statutes' ... Period of limitation for filing an appeal - Disallowance of CGST input credit - appellant preferred an appeal on 16.12.2019 under Section 107 (1) of the Chhattisgarh Goods and Service Tax Act, 2017 before respondent No.3 and had deposited 10% of the amount in dispute - appeal rejected on the ground of time limitation - HELD THAT:- A reading of Section 29(2) would go to show that the section is divided into two parts, manifested by the expression “and”. The first part stipulates that the limitation period prescribed by the special law or local law will prevail over the limitation period prescribed in the Schedule to the Limitation Act. The second part of Section 29(2) of the Limitation Act ordains that the Sections 4 to 24 of the Limitation Act will apply for determining the period of limitation “only insofar as, and to the extent which, they are not expressly excluded by such special or local law.” CGST Act is a “special law” which prescribes a specific period of limitation in Sections 107(1) and 107(4), and therefore, the provisions of CGST Act will apply. It is also to be noted that there is no provision under the Limitation Act dealing with the subject matter of appeal under the CGST Act. On due consideration of the scheme of the C.E. Act, the Hon'ble Supreme Court concluded that the time-limit prescribed under Section 35-H(1) to make a reference to the High Court is absolute and unextendable by a Court under Section 5 of the Limitation Act. It was also observed that it is the duty of the Court to respect the legislative intent and by giving liberal interpretation, limitation cannot be extended by invoking the provisions of Section 5 of the Limitation Act. In respect of an appeal to the High Court, the Legislature has not provided any specific time limit for entertainment of an appeal after expiry of the period of limitation if it is satisfied that there was sufficient cause for not filing the same within the period of limitation. In respect of an appeal under Section 107(1) of CGST Act, it is provided that the appeal may be filed within three months from the date on which the decision or order is communicated to such person. Section 107(4) of CGST Act lays down that on sufficient cause being shown, the Appellate Authority may allow the appeal to be presented within a further period of one month. The same would go to show that the legislative intent was not to apply the Limitation Act in the proceedings to be taken under the CGST Act. If the intention had been otherwise, there would have been no occasion for conferring specifically power to the High Court to entertain an appeal after the expiry of the period of limitation of 180 days if it was satisfied that there was sufficient cause for not filing it within such period as Section 5 of the Limitation Act would have become applicable by virtue of Section 29(2) of the Limitation Act. Absence of the words 'but not thereafter' as appearing in the Act of 1996 is of no moment. There are no merit in this appeal and accordingly, the writ appeal is dismissed. Issues Involved:1. Whether the CGST Act allows condonation of delay beyond the period prescribed under Section 107(4).2. Applicability of the Limitation Act, 1963 to the CGST Act.3. Legislative intent regarding the exclusion of Limitation Act provisions in special laws.Detailed Analysis:1. Whether the CGST Act allows condonation of delay beyond the period prescribed under Section 107(4):The core issue in this case was whether the Appellate Authority under the CGST Act has the power to condone delays beyond the period stipulated in Section 107(4). The appellant argued that the delay was due to the illness of their Chartered Accountant and that the Limitation Act should apply, allowing for condonation of the delay. The respondents contended that the CGST Act is a special law and does not permit condonation beyond the specified period.2. Applicability of the Limitation Act, 1963 to the CGST Act:The appellant's counsel argued that Section 29(2) of the Limitation Act applies because there is no express exclusion of Sections 4 to 24 of the Limitation Act in the CGST Act. The respondents countered that the CGST Act is a complete code and the Limitation Act is excluded by necessary implication.3. Legislative intent regarding the exclusion of Limitation Act provisions in special laws:The court examined whether the CGST Act, as a special law, intended to exclude the Limitation Act. The court referenced several Supreme Court judgments to determine the legislative intent. The judgments in Patel Brothers v. State of Assam, P. Radha Bai and Others v. P. Ashok Kumar and Another, and Singh Enterprises v. Commissioner of Central Excise, Jamshedpur and Others were particularly relevant. These cases established that special laws could exclude the Limitation Act by necessary implication, even without express exclusion.Detailed Judgment:Condonation of Delay Under CGST Act:The court noted that Section 107(1) of the CGST Act allows an appeal within three months from the date of the decision. Section 107(4) permits the Appellate Authority to condone delays of up to one month beyond this period if sufficient cause is shown. The court held that the Appellate Authority becomes functus officio (without further authority) after this period and cannot entertain appeals beyond this additional month.Applicability of Limitation Act:The court examined Section 29(2) of the Limitation Act, which applies the Limitation Act's provisions to special laws unless expressly excluded. However, it found that the CGST Act, being a special law, prescribes specific limitation periods and does not provide for the applicability of the Limitation Act. The court referenced Hukumdev Narain Yadav v. Lalit Narain Mishra and Commissioner of Customs and Central Excise v. Hongo India Private Limited, which supported the view that the scheme of a special law could exclude the Limitation Act.Legislative Intent and Special Law:The court emphasized that the CGST Act is intended to be a complete code governing its matters, excluding the Limitation Act. It cited multiple Supreme Court judgments, including Union of India v. Popular Construction Co. and Assistant Commissioner (CT) LTU, Kakinada & Others v. Glaxo Smith Kline Consumer Health Care Limited, which held that specific limitation provisions in special laws indicate legislative intent to exclude the Limitation Act.Conclusion:The court concluded that the CGST Act does not allow for condonation of delay beyond the additional one month provided under Section 107(4). The Limitation Act does not apply to the CGST Act due to its nature as a special law and the legislative intent to create a complete code. Therefore, the appeal was dismissed, upholding the decision of the learned Single Judge and the Appellate Authority's rejection of the appeal as time-barred.