2023 (10) TMI 1076 - HC - GST

Violation of principles of natural justice - no opportunity of personal hearing, as mandated under Section 75(4) of the Act, was given to the assessee before final order was passed - appeal dismissed as being time barred - whether period of limitation in filing the appeal stood extended pursuant to 52nd Meeting of the GST Council held on 7th October, 2023 and the benefit be passed on to the petitioner? - HELD THAT - Section 75(4) of the Act provides for an opportunity of hearing to an assessee where a request is received in writing from the person chargeable with tax or penalty or whether adverse decision is contemplated against such person. It is not in dispute that a show cause notice was issued to the petitioner-assessee on 17.02.2022. The notice remained unattended and was not replied. The Taxing Authorities proceeded with the matter and passed order under Section 74(9) on 22.03.2022. The decision relied upon by the assessee in case of M/s Mohan Agencies 2023 (2) TMI 933 - ALLAHABAD HIGH COURT and M/S VISWKARMA FURNITURE VERSUS ADDITIONAL COMMISSIONER GRADE 2 AND ANOTHER 2023 (4) TMI 1262 - ALLAHABAD HIGH COURT are distinguishable in the present set of case, as in both the cases the notice was replied by the assessee but opportunity of personal hearing was not accorded and thus the Court proceeded to quash the order and remanded back the matter for deciding afresh - In the instant case, no reply was given by the assessee, thus, provisions of Section 75(4) would not be attracted as neither any request was made for granting opportunity of hearing nor any explanation was furnished to the contents of notice. Period of extension of limitation for filing the appeal - HELD THAT - This Court finds that no plausible ground has been taken in the appeal filed by the assessee for condoning the delay except that the earlier counsel, to whom papers were handed over, did not file the appeal and by mistake the delay had occurred. Moreover, Section 107(4) of the Act provides that the Appellate Authority may, if satisfied that the appellant was prevented by sufficient cause from presenting the appeal within the aforesaid period of three or six months, as the case may be, allow it to be presented within further period of one month. Once it is found that limitation period having been prescribed in the statute had expired, the Appellate Authority rightly proceeded to dismiss the appeal. The order of the Appellate Authority needs no interference by this Court - this Court finds that no interference is required in the notice dated 17.02.2022 issued by respondent No.2 as well as consequential order passed on 22.3.2022 passed by respondent No.2 - Petition disposed off.

Summary

Issues involved:
The issues involved in the judgment are (1) whether personal hearing should have been given to the petitioner before the order was passed by respondent No.2 in proceedings under Section 74, and (2) whether the period of limitation in filing the appeal stood extended pursuant to the 52nd Meeting of the GST Council held on 7th October, 2023 and if the benefit should be passed on to the petitioner.

Issue 1: Personal Hearing
The petitioner, a proprietorship firm registered under the UPGST Act and CGST Act, was issued a notice under Section 74(1) of the Act on 17.02.2022, regarding a dispute for the period June 2019, Financial Year 2019-20. The Taxing Authority passed an order imposing penalty and interest on 22.03.2022, which was appealed by the petitioner but dismissed on 11.08.2023 due to delay. The petitioner contended that no personal hearing was provided before the final order was passed, citing relevant case laws. However, the Court found that as the petitioner did not reply to the notice, the provisions of Section 75(4) requiring an opportunity of hearing were not attracted, and hence, the order was upheld.

Issue 2: Extension of Limitation Period
The petitioner argued that the period of limitation for filing the appeal should be extended based on the decision of the 52nd Meeting of the GST Council. The Court noted that the appeal did not provide sufficient grounds for condoning the delay, and as per Section 107(4) of the Act, the Appellate Authority rightly dismissed the appeal due to the expired limitation period. Citing legal precedents, the Court emphasized that the Act is a special statute with an inbuilt mechanism excluding the application of the Limitation Act. However, considering the GST Council's extension of the limitation period till 31st January 2024 under an amnesty scheme, the Court remanded the matter back to the Appellate Authority for reevaluation.

Conclusion
The Court found no interference necessary in the notice issued by respondent No.2 on 17.02.2022 and the consequential order passed on 22.03.2022. However, the appellate order of 11.08.2023 was set aside, and the matter was remanded back to the Appellate Authority for a fresh consideration, especially regarding the limitation period in light of the GST Council's amnesty scheme. The writ petition was disposed of with these observations.