2021 (11) TMI 582 - HC - GST

Recovery of tax alongwith interest and penalty - Jurisdiction - invoking wrong provisions of GST - Non-payment of GST - petitioner had failed to file Goods and Service Tax (GST) returns since October, 2017 to December, 2018 - HELD THAT - Against an order passed under Section 73 of the Act, the person aggrieved has a remedy of filing appeal to the appellate authority under Section 107 of the Act. As per sub-section (1) thereof, such appeal may be filed within three months from the date of communication of the order or decision. As per subsection (4), if the appellate authority is satisfied that the appellant was prevented by sufficient cause from presenting the appeal within the aforesaid period of three months, it shall allow the appellant to present the same within a further period of one month. In the instant case, the order under Section 73 was passed on 28.03.2019 and communicated since petitioner has deposited the tax in terms of the said order. Period of three months and the extended period of further one month have expired long back. It is settled law that when the statute does not provide for further extension of limitation beyond the extended period, the limitation for filing appeal would end on the expiry of the extended period of limitation provided by the statute. To circumvent the situation recourse to a proceeding under Article 226 of the Constitution of India is not permissible. Respondent No.1 had the jurisdiction to assess the petitioner, whether it is under Section 62 or under Section 73 of the Act. Even if we accept the contention of learned counsel for the petitioner that respondent No.1 ought to have proceeded under Section 62 and not under Section 73, it is at best a case of invoking a wrong legal provision instead of another, but certainly that will not make it a case of no jurisdiction, or lack of jurisdiction. Acting without jurisdiction is one thing and invoking a wrong provision while acting within jurisdiction is another thing - the petitioner has partly complied with the Order-in-Original by paying the tax dues. If that be the position, then there is acceptance of the Order-in-Original. Thereafter, part challenge to the Order-in-Original may not be maintainable. The writ petition is dismissed.

Summary

Issues involved:
Assailed legality and validity of Order-in-Original under Section 73 of the Central Goods and Services Tax Act, 2017. Jurisdictional error or wrongful assumption of jurisdiction by the assessing officer. Challenge to the Order-in-Original in a writ proceeding.

Analysis:

1. Assailed legality and validity of Order-in-Original:
The petitioner challenged the Order-in-Original dated 28.03.2019, which confirmed a tax demand of ?1,54,76,440 and imposed penalties under various sections of the CGST Act, 2017. The petitioner argued that the assessing officer should have proceeded under Section 62 for non-filing of returns, not Section 73. However, the court noted that the petitioner had partly complied with the order by paying the tax dues, indicating acceptance of the order. The court held that challenging part of the order after acceptance may not be maintainable.

2. Jurisdictional error:
The petitioner contended that the assessing officer wrongly assumed jurisdiction under Section 73 instead of Section 62. The court clarified that even if the officer erred in choosing the provision, it did not amount to a lack of jurisdiction. The court emphasized that acting under a wrong provision within jurisdiction is different from acting without jurisdiction. Therefore, the court was not convinced by the argument of jurisdictional error.

3. Challenge to the Order-in-Original in a writ proceeding:
The court highlighted that the statutory remedy of filing an appeal against the order had expired, as the appeal period had lapsed. Citing the Supreme Court's decision in a similar case, the court emphasized that when the statutory period for appeal ends, resorting to Article 226 proceedings is impermissible. The court referred to a case where the High Court entertained a writ petition challenging an assessment order despite the appeal period lapsing, and the Supreme Court held that the High Court should not have entertained the writ petition. Consequently, the court concluded that the challenge to the Order-in-Original could not be entertained in the present writ proceeding.

In conclusion, the court dismissed the writ petition, stating that the challenge to the Order-in-Original could not be entertained due to the lapse of the appeal period. The court clarified that even if the assessing officer erred in choosing the legal provision, it did not amount to a lack of jurisdiction. The petitioner's partial compliance with the order by paying the tax dues indicated acceptance of the order, making it challenging to contest the order in a writ proceeding.