Appeal within time as limitation starts from communication date, not order date, u/s 107(4) CGST Act

HC held that the First Appellate Authority erred in treating the appeal as time-barred. The order-in-original dated 24.01.2024 was communicated on 01.02.2024, which was to be treated as "Day Zero" for limitation purposes, entitling the petitioner to the extended one-month period under Section 107(4) CGST Act. On this computation, the appeal filed on 01.06.2024 was within the permissible period. The finding of delay and consequent rejection of the appeal was therefore unsustainable. HC set aside the impugned appellate order dated 19.06.2025 and remanded the matter to the Appellate Authority for fresh adjudication on merits, after granting due opportunity of hearing to the parties.

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1. ISSUES PRESENTED AND CONSIDERED

1.1 Whether the appeal under Section 107 of the CGST Act, 2017 was filed within the prescribed and condonable period of limitation, having regard to the date of communication of the order-in-original.

1.2 How the period of limitation under Section 107 of the CGST Act, 2017 is to be computed, specifically whether the date of passing/communication of the order is to be excluded as "Day Zero".

1.3 Consequentially, whether the order of the First Appellate Authority dismissing the appeal as time-barred was legally sustainable, and what relief, if any, should be granted.

2. ISSUE-WISE DETAILED ANALYSIS

Issue 1 & 2: Limitation under Section 107 CGST Act and computation of period from date of communication

Legal framework (as discussed)

2.1 The Court noted the scheme of Section 107 of the CGST Act, 2017, under which an appeal has to be filed within three months from the date of communication of the order, with power to extend the period by one further month upon sufficient cause being shown under Section 107(4).

Interpretation and reasoning

2.2 The order-in-original was passed on 24.01.2024 and admittedly communicated on 01.02.2024.

2.3 The First Appellate Authority treated 01.02.2024 as the starting date for limitation, computed the normal period of three months as expiring on 30.04.2024, and the extended one month as expiring on 30.05.2024, and consequently held that an appeal filed on 01.06.2024 was delayed by one day and hence beyond jurisdiction.

2.4 The Court recorded that the respondent could not dispute that the calculation by the Appellate Authority did not correctly apply the principle that the date of passing/communication of the order is to be excluded while computing limitation.

2.5 The Court held that the date on which the order is passed/communicated has to be treated as "Day Zero (0)", and limitation begins from the following day. In support, the Court agreed with and followed the view of the High Court of Delhi in the decision concerning interpretation of limitation under Section 107 of the CGST Act, where the date of communication was treated as Day Zero.

2.6 Applying this principle, and taking 01.02.2024 as Day Zero, the Court concluded that, with the benefit of the condonable one month under Section 107(4), the appeal filed on 01.06.2024 fell within the permissible period of limitation.

2.7 The Court further noted that the Appellate Authority appeared to have accepted the explanation tendered by the appellant (regarding being out of the country and lack of communication with earlier counsel) and, accordingly, had itself proceeded to compute limitation by adding the additional one month contemplated by Section 107(4); hence, the appellant was entitled to the extended period.

Conclusions

2.8 The Court held that the First Appellate Authority erred in law in computing limitation by including the date of communication of the order as part of the limitation period, instead of treating it as Day Zero.

2.9 The Court held that, properly computed, the appeal filed on 01.06.2024 was within the total period of limitation (inclusive of the condonable one-month extension under Section 107(4) of the CGST Act, 2017).

2.10 The dismissal of the appeal as time-barred on the ground of a one-day delay was therefore unsustainable and liable to be set aside.

Issue 3: Validity of appellate order and appropriate relief

Interpretation and reasoning

3.1 Having found the appeal to be within limitation, the Court concluded that the First Appellate Authority had wrongly declined to entertain the appeal on the sole ground of delay.

3.2 The Court noted that the appeal had not been considered on merits, and there was also a grievance of absence of opportunity of personal hearing before the Appellate Authority.

Conclusions

3.3 The order in appeal dated 19.06.2025 was set aside.

3.4 The matter was remanded to the Appellate Authority to decide the appeal afresh on merits, strictly in accordance with law, after affording an opportunity of hearing to the concerned parties.

3.5 The Court expressly clarified that it had expressed no opinion on the merits of the underlying dispute or the refund claim.

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