2023 (10) TMI 1332 - HC - GST

Petitioner can file delayed appeal against excess input tax credit order with condonation application until January 2024

Gujarat HC disposed of petition regarding delay in filing appeal against excess input tax credit order. Court held petitioner can file appeal with ... Jurisdiction under Article 226 - condonation of delay - statutory remedy - principles of natural justice - appeal under Section 107 - amnesty scheme/recommendations of GST CouncilJurisdiction under Article 226 - condonation of delay - statutory remedy - Writ jurisdiction under Article 226 cannot be exercised to condone delay in filing an appeal where a statutory remedy of appeal is available and the larger bench's decision in Panoli Intermediate (India) Ltd. is applicable. - HELD THAT: - The Court noted that a statutory remedy to challenge the assessment order was available under the Act and that precedential guidance of the larger bench in Panoli Intermediate (India) Ltd. precludes invocation of Article 226 for the purpose of condoning delay in filing an appeal. Having regard to that principle, the Court declined to exercise writ jurisdiction to condone the delay and to entertain the petition as a substitute for the appellate remedy. The Court observed that the petitioner had, in any event, not preferred the statutory appeal and that reliance on Article 226 for condonation would be impermissible in the facts of the case. [Paras 6, 8]Petition under Article 226 cannot be used to condone delay where statutory appeal remedy exists; writ jurisdiction to condone delay was not exercised.Appeal under Section 107 - principles of natural justice - amnesty scheme/recommendations of GST Council - Petitioner permitted to file an appeal under Section 107 with an application for condonation of delay; appellate authority may consider allegations of violation of principles of natural justice and the GST Council's amnesty recommendations. - HELD THAT: - Although the Court did not adjudicate the merits of the assessment, it directed that the petitioner is free to file the statutory appeal accompanied by an application for condonation of delay, setting out grounds including alleged denial of opportunity of hearing and discrepancies in figures between the show-cause notice and the final order. The Court expressly observed that the appellate authority, while deciding the condonation application, may take into account the circumstances raised by the petitioner and the GST Council's recommendation permitting belated appeals against demand orders passed on or before 31.03.2023 up to 31.01.2024 subject to prescribed pre-deposit conditions. The Court left the decision on remittance, verification or consideration of natural justice issues to the appellate forum in accordance with law. [Paras 9, 10, 11]Petitioner allowed to file appeal with a condonation application; appellate authority to consider alleged breach of natural justice and the GST Council's amnesty recommendations when deciding the condonation and appeal.Final Conclusion: Writ petition dismissed without adjudication on merits; petitioner may pursue the statutory appeal under Section 107 with a condonation application, and the appellate authority is to consider the pleaded violation of principles of natural justice and the GST Council's amnesty recommendations in accordance with law. Issues involved: Challenge to order under Section 73 of the GST Act for excess input tax credit claimed.Summary:Issue 1: Challenge to order under Section 73 of the GST ActThe petitioner, a partnership firm engaged in manpower services, challenged an order dated 06.04.2022 under Section 73 of the GST Act for claiming excess input tax credit. The petitioner received a notice in Form ASMT-10 under section 61 of the Act for financial year 2018-19, followed by a show-cause notice under Section 73 for claiming Rs. 46,85,584/- excess input tax credit. The petitioner contended that the order was passed without giving an opportunity of hearing, violating principles of natural justice. The petitioner cited a court decision suggesting that orders passed without an opportunity of hearing should be set aside for a fresh hearing. The respondent relied on a decision regarding the maintainability of petitions under Article 226 of the Constitution of India. The court noted that the petitioner could have filed an appeal but chose not to do so, and recommended filing an appeal with an application for condonation of delay as per the 52nd GST Council recommendations.Issue 2: Remedy for violation of natural justiceThe court observed that even if there was a violation of natural justice, the petitioner had the remedy of filing an appeal but did not do so. The court referred to a decision stating that jurisdiction under Article 226 cannot be exercised to condone a time-barred appeal. The court suggested that the petitioner can file an appeal with an application for condonation of delay, explaining the circumstances preventing timely filing. The court highlighted the GST Council's recommendations for an amnesty scheme for filing appeals against demand orders, allowing appeals until 31.01.2024 for orders passed on or before 31.03.2023.Conclusion:The petition was disposed of with the court clarifying that it did not delve into the merits of the matter. The appellate authority was advised to consider the aspects raised in the petition, the court's observations, and the GST Council recommendations while deciding on the application for condonation of delay.