2024 (5) TMI 1140 - HC - GST

High Court Reinstates Time-Barred Tax Appeal, Directs Hearing Within Six Weeks Despite Imperfect Delay Explanation

HC allowed appeal challenging dismissal of time-barred appeal under WBGST/CGST Act. Despite finding explanation for delay not entirely satisfactory, Court ... Condonation of delay - power to condone delay under Section 5 of the Limitation Act - appellate authority's jurisdiction to admit a delayed appeal under Section 107(4) of the WBGST/CGST Act, 2017 - failure to exercise jurisdiction / non-consideration of condonation application - setting aside administrative rejection and restoration of appeal for fresh disposalAppellate authority's jurisdiction to admit a delayed appeal under Section 107(4) of the WBGST/CGST Act, 2017 - power to condone delay under Section 5 of the Limitation Act - failure to exercise jurisdiction / non-consideration of condonation application - Whether the appellate authority was obligated to consider the petitioner's application for condonation of delay and whether it had jurisdiction to accept an appeal filed beyond the period prescribed under Section 107(4) of the WBGST/CGST Act, 2017. - HELD THAT: - The Division Bench decision in S.K. Chakraborty & Sons v. Union of India & Ors. (reported in 2023 SCC online Cal 4759) is treated as determinative on the question of whether an appellate authority can entertain an appeal filed beyond the statutory time under Section 107(4). Applying that precedent, the Court found that the appellate authority failed to exercise its jurisdiction and did not appropriately consider the petitioner's explanation for delay. The High Court held that there is no bar to consideration of an application for condonation under Section 5 of the Limitation Act even where the appeal is time barred under the said Act, and that the appellate authority ought to have adjudicated the condonation application on its merits rather than mechanically rejecting the appeal for being time barred. Having examined the written and oral explanations, the Court, while noting that the explanation was not entirely satisfactory, exercised its discretion in the interests of justice to condone the delay and to set aside the impugned administrative rejection. [Paras 7, 8, 9]The appellate authority had jurisdiction to consider condonation under Section 5 of the Limitation Act and it erred in failing to exercise that jurisdiction; the High Court condoned the delay and set aside the order of rejection.Setting aside administrative rejection and restoration of appeal for fresh disposal - restoration of appeal and remit for hearing on merits - Whether the petitioner's appeal should be restored for adjudication on merits and what directions should follow upon condonation of delay. - HELD THAT: - On condoning the delay, the Court set aside the appellate authority's order issued in Form GST APL-02 which rejected the appeal, restored the appeal to its original file and number, and directed the appellate authority to hear and dispose of the appeal afresh. The Court imposed a timeline, directing that the appeal be heard and disposed of preferably within six weeks from communication of the High Court's order, while ensuring the petitioner is afforded an opportunity of hearing. The Court's directions therefore remit the substantive controversy to the appellate authority for fresh adjudication on merits. [Paras 9, 10]Order dated 20th December 2023 rejecting the appeal is set aside; the appeal is restored and remitted to the appellate authority to be heard and disposed of preferably within six weeks after giving the petitioner an opportunity of hearing.Final Conclusion: Delay in filing the appeal under Section 107 was condoned; the order rejecting the appeal for delay is set aside, the appeal is restored to its original file and number, and the appellate authority is directed to hear and dispose of the appeal on merits preferably within six weeks. Issues involved: Appeal against order u/s WBGST/CGST Act 2017 for condonation of delay.The petitioner filed an appeal challenging an order passed u/s WBGST/CGST Act 2017, which was beyond the prescribed period of limitation. The appellate authority dismissed the appeal citing violation of section 107(1) and exceeding the time limit u/s 107(4) of the Act. The petitioner sought condonation of delay invoking Section 5 of the Limitation Act, emphasizing a strong case on merits.The High Court considered the materials on record and referred to a previous judgment regarding the acceptance of appeals beyond the prescribed time limit u/s 107(4) of the Act. It found that the appellate authority failed to exercise its jurisdiction and should have properly considered the petitioner's explanation for the delay.After evaluating the written and oral explanations provided by the petitioner, the Court, despite finding the explanation not entirely satisfactory, decided to condone the delay in filing the appeal u/s 107 of the Act. The order dismissing the appeal was set aside, and the appeal was restored to its original file and number. The appellate authority was directed to hear and dispose of the appeal within six weeks, providing an opportunity of hearing to the petitioner.The writ petition was disposed of without any order as to costs, and since no affidavits were called for, the allegations in the petition were deemed not admitted by the respondents. All parties were instructed to act based on the server copy of the Court's order downloaded from its website.