2022 (7) TMI 82 - HC - GST

Maintainability of appeal - time limitation - appeal was dismissed on the ground that the appeal was filed beyond the period of extended limitation - HELD THAT - As per subsection (1) of Section 107 of the CGST Act, limitation for filing appeal is three months from the date of communication of the order appealed against. Under subsection (4) of Section 107 of the CGST Act, the appellate authority may allow the appeal to be presented within a further period of one month, provided sufficient cause is shown by the appellant. Though the lower appellate authority may be right in holding that while it may allow filing of an appeal beyond the limitation of three months for a further period of one month, therefore, by extension of limitation beyond the extended period of one month delay beyond the extended period of one month cannot be condoned, we are of the view that such a stand taken by respondent No.1 may adversely affect the petitioner. This is more so because respondent No.2 had suo motu cancelled the GST registration of the petitioner on the ground of non-filing of returns and as GST Tribunal has not been constituted under Section 109 of the CGST Act, petitioner would be left without any remedy. It is further found that the issue pertains to cancellation of GST registration of the petitioner. In the facts and circumstances of the case, it would be just and proper if the entire matter is remanded back to respondent No.2 to reconsider the case of the petitioner and thereafter to pass appropriate order in accordance with law. Petition allowed by way of remand.

Summary

Issues:
Petition seeking quashing of order-in-appeal for cancellation of GST registration due to appeal being filed beyond the extended limitation period.

Analysis:
The petitioner, a proprietorship firm engaged in works contract services in Telangana, filed a petition under Article 226 seeking to quash the order-in-appeal dated 19.04.2022, which canceled its GST registration. The appellate authority dismissed the appeal as it was filed beyond the extended limitation period. The petitioner did not approach the GST Tribunal under Section 112 of the CGST Act as it had not been constituted yet. The appellate authority's decision was based on Section 107 of the CGST Act, which allows a one-month extension for filing an appeal with sufficient cause shown by the appellant.

The High Court noted that while the appellate authority could allow filing an appeal beyond the initial three-month limitation for a further one month, it could not condone delays beyond this extended period. The Court expressed concern that the petitioner, whose GST registration was canceled due to non-filing of returns, would be left without a remedy as the GST Tribunal had not been constituted. The issue primarily revolved around the cancellation of the petitioner's GST registration, prompting the Court to remand the matter back to the authority to reconsider and pass an appropriate order in accordance with the law.

The Court decided to remand the matter without expressing any opinion on the merit, instructing the petitioner to submit all returns as per the statute when the matter is heard on remand. The writ petition was disposed of without any order as to costs, with miscellaneous applications pending to stand closed. The judgment highlighted the importance of adhering to statutory timelines for filing appeals and the necessity for a constituted GST Tribunal to provide an effective remedy in such cases.