2024 (5) TMI 258 - HC - GST

Refund of the unutilized ITC of GST Compensation Cess on coal - zero rated supply - rejection of refund on the ground of time limitation - Vires of Clause 5 of the impugned Notification No. 53/2023 Central Tax dated 02.11.2023 issued by the Central Board of Indirect Taxes Customs - Rejection of Appeal for Delay - HELD THAT - It is the case of the petitioner-Company itself that the notification was issued by the Government of India as various orders were being passed by the authorities and they were being uploaded on the web portal of the Department. However, since the orders were uploaded but could not be communicated to the parties concerned, delay was caused in preferring appeals against those orders and the appeals were being dismissed on the ground of delay. To overcome such situation, the impugned notification was brought in so that the appeals could be heard and the delay if any caused in preferring the appeal could be condoned. In the case in hand, admittedly, the appeals were filed by the petitioner-Company before the Joint Commissioner (Appeals), State Tax with some delay and the said appeals stood dismissed vide order dated 05.12.2023 (Annexure P/1) in light of clause 5 of the impugned notification. The learned Joint Commissioner has observed that the appeal was filed by the petitioner Company after a delay of 1 year and 1 month from the prescribed time limit and no cogent reason was afforded for such an inordinate delay. There are no error in the order (Annexure P/1) passed by the respondent No. 4. So far as declaring clause 5 of the impugned notification is concerned, a plain reading of the said clause would make it amply clear that no appeal would lie under this Notification in respect of a demand not involving tax. It is a case where the petitioner-Company is claiming refund of tax which was rejected and the appeal before the Joint Commissioner also stood dismissed on the ground of limitation. No cogent reason has been assigned as to how the said clause is ultra vires the Constitution of India. The appeal filed by the petitioner-Company is barred by limitation and it is not in a position to avail the benefit of extension of time period which has been granted by the Notification and as such, the relief sought for by the petitioner-Company to declare clause 5 of the impugned Notification, does not merit acceptance. All the writ petitions are dismissed.

Summary

Issues Involved:
1. Challenge to the Order dated 05.12.2023.
2. Constitutional validity of Clause 5 of Notification No. 53/2023.

Summary:

Challenge to the Order dated 05.12.2023:

The petitioner challenged the order dated 05.12.2023 passed by the Joint Commissioner (Appeals) State Tax, Bilaspur, which rejected the petitioner's appeal on the grounds of delay. The petitioner argued that the order rejecting the refund application was not communicated to them until they received a physical copy on 07.08.2023. Consequently, the appeal was filed within the prescribed time limit from the date of communication. The petitioner contended that the term 'communicated' under Section 107(1) of the CGST Act should be interpreted as the date on which the physical copy was received, not the date of uploading on the portal. The court, however, found no error in the order passed by the respondent No. 4, observing that the appeal was filed after a delay of 1 year and 1 month from the prescribed time limit without any cogent reason.

Constitutional Validity of Clause 5 of Notification No. 53/2023:

The petitioner also sought to quash Clause 5 of the impugned Notification No. 53/2023, arguing that it created hostile discrimination and was arbitrary, thereby violating Article 14 of the Constitution of India. Clause 5 of the Notification states that no appeal shall be admissible in respect of a demand not involving tax. The petitioner contended that this clause discriminates between taxpayers with a tax demand and those without, despite both being similarly situated. The court, however, held that the petitioner failed to provide cogent reasons to declare Clause 5 ultra vires the Constitution. The court affirmed that the clause clearly states that no appeal would lie under this Notification in respect of a demand not involving tax, and the petitioner's appeal was rightly dismissed on the ground of limitation.

Conclusion:

All writ petitions were dismissed, with the petitioner being at liberty to approach the Appellate Tribunal or the learned Single Judge, if so advised.