Appellate authority cannot reject appeal filed within condonable delay period under Section 107 CGST Act without hearing

The Bombay HC set aside the appellate authority's order rejecting petitioner's appeal as time-barred. The appeal was filed 18 days after the 3-month statutory period under Section 107 CGST Act 2017, but within the additional 1-month condonable period. The appellate authority initially granted adjournment but subsequently cancelled the hearing and rejected the appeal without providing hearing opportunity. The HC held the rejection was improper since the delay was within condonable limits and remanded the matter for fresh consideration of the condonation application.

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Issues:
1. Challenge to impugned order rejecting appeal
2. Timeliness of appeal under Section 107 of CGST Act 2017
3. Breach of principles of natural justice and fair play
4. Rejection of appeal without a hearing opportunity
5. Condonation of delay in instituting appeal
6. Setting aside impugned order and remanding the matter

Analysis:
The petitioner challenged the impugned order dated 31 January 2024, rejecting the appeal, despite having an alternate remedy available. The High Court noted a gross breach of natural justice and fair play, deciding not to relegate the petitioner to the alternate remedy due to the circumstances. The proper officer raised an adjudication demand on 11 August 2023, leading to the petitioner filing a rectification application and subsequently an appeal within 108 days of the rejection of the rectification application.

Regarding the timeliness of the appeal under Section 107 of the CGST Act 2017, which mandates the appeal to be ordinarily instituted within 3 months, the High Court observed that the appeal was filed within 18 days of the expiry of the 3-month period, falling within the condonable period. The appellate authority's handling of the case was also scrutinized, noting that the petitioner was denied a proper hearing opportunity before the appeal was rejected as time-barred.

The High Court found that the petitioner had sufficient cause for the delay in instituting the appeal and condoned the delay of 18 days. Consequently, the impugned order dated 31 January 2024 was set aside, and the matter was remanded to the appellate authority for a decision on the appeal's merits. The Court directed the appellate authority to dispose of the appeal following the law, leaving all contentions of the parties open for consideration.

In conclusion, the High Court made the Rule absolute in the terms mentioned, with no orders as to costs, and instructed all concerned parties to act on an authenticated copy of the order for further proceedings.

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