Condonation of delay in GST statutory appeals granted under extraordinary constitutional jurisdiction where counsel negligence caused inaction

High Court exercised extraordinary constitutional jurisdiction to condone delay in filing a statutory GST appeal, finding that the delay resulted from counsel/consultant accountant negligence and that a litigant should not be penalised for such professional default; consequence: the court allowed relief and enabled the appellant to pursue statutory remedies. The court held that permanent exclusion from the GST framework for missed appellate deadlines or cancelled registration, despite willingness to comply by filing returns and paying dues, would frustrate the facilitative object of the regime and impose disproportionate hardship on livelihood; consequence: restoration or relief is appropriate to avoid violation of equality and personal liberty.

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Issues: (i) Whether the High Court, in exercise of its constitutional jurisdiction under Article 226, can condone delay in filing a statutory appeal beyond the outer limit prescribed by Section 107(4) of the Central Goods and Services Tax Act, 2017, and whether the appellate order dismissing the appeal as time-barred can be set aside and the appeal remanded for adjudication on merits.

Analysis: The statutory scheme under Section 107 prescribes a three month limitation for filing an appeal and permits condonation only for an additional period of one month upon satisfaction of "sufficient cause." Section 107(4) operates as an express statutory cap on the Appellate Authority's power to condone delay. However, constitutional jurisdiction under Article 226 is plenary and founded on principles of justice, equity and good conscience. Prior Division Bench precedents distinguishing Molana Construction on their facts do not constitute a binding exclusion of Article 226 powers. Coordinate High Court and other High Court authorities have held that while the Appellate Authority's power is confined by Section 107, the High Court may in appropriate cases exercise its constitutional discretion to prevent denial of remedy and avoid disproportionate hardship to a business. In the present case, affidavit evidence explained the delay as attributable to reliance on a consultant/advocate and unavoidable personal circumstances; the appellate authority rejected the appeal as time-barred without adjudicating merits. Considering the nature of fiscal legislation and the need to balance statutory limitation with prevention of manifest injustice, the writ jurisdiction can be exercised to condone delay where sufficient cause is shown and where refusal would result in denial of effective remedy.

Conclusion: The delay of 160 days in filing the statutory appeal is condoned in exercise of Article 226 jurisdiction. The appellate order dismissing the appeal as time-barred is set aside and the appeal is remanded to the Appellate Authority for adjudication on merits in accordance with law.

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