2024 (12) TMI 338 - HC - GST

Rejection of petitioner s appeal - petitioner has an alternate and efficacious remedy against this order - HELD THAT - Section 107 of the CGST Act 2017 states that the appeal must be ordinarily instituted within 3 months. However, suppose the appellate authority is satisfied that the appellant was prevented by sufficient cause from presenting the appeal within 3 months. In that case, the appellate authority may allow it to be presented within a further period of 1 month - In this case, the appeal was not instituted within 3 months but within 18 days of the expiry of these 3 months. Thus, it was instituted within the condonable period. On 29 January 2024, the appellant's authorised representative was not available, so an email application for adjournment was made. The appellate authority accepted the motion for adjournment and, by email dated 30 January 2024, fixed the next date for the personal hearing as 06 February 2024 - On the next date, i.e. 01 February 2024, the appellate authority changed its mind and emailed the petitioner that the hearing scheduled for 06 February 2024 had been cancelled. Before the petitioner could react, the appellate authority made the impugned order dated 31 January 2024, rejecting the petitioner s appeal on the ground that the same was time-barred. This was communicated to the petitioner on 05 February 2024. In the circumstances, such rejection was without a hearing opportunity for the petitioner. The impugned order dated 31 January 2024 is set aside and the matter remanded to the appellate authority to consider the petitioner s application for condonation of delay of 18 days since such application was well within the condonable period - petition allowed by way of remand.

Summary

Issues:
1. Challenge to impugned order rejecting appeal
2. Timeliness of appeal under Section 107 of CGST Act 2017
3. Breach of principles of natural justice and fair play
4. Rejection of appeal without a hearing opportunity
5. Condonation of delay in instituting appeal
6. Setting aside impugned order and remanding the matter

Analysis:
The petitioner challenged the impugned order dated 31 January 2024, rejecting the appeal, despite having an alternate remedy available. The High Court noted a gross breach of natural justice and fair play, deciding not to relegate the petitioner to the alternate remedy due to the circumstances. The proper officer raised an adjudication demand on 11 August 2023, leading to the petitioner filing a rectification application and subsequently an appeal within 108 days of the rejection of the rectification application.

Regarding the timeliness of the appeal under Section 107 of the CGST Act 2017, which mandates the appeal to be ordinarily instituted within 3 months, the High Court observed that the appeal was filed within 18 days of the expiry of the 3-month period, falling within the condonable period. The appellate authority's handling of the case was also scrutinized, noting that the petitioner was denied a proper hearing opportunity before the appeal was rejected as time-barred.

The High Court found that the petitioner had sufficient cause for the delay in instituting the appeal and condoned the delay of 18 days. Consequently, the impugned order dated 31 January 2024 was set aside, and the matter was remanded to the appellate authority for a decision on the appeal's merits. The Court directed the appellate authority to dispose of the appeal following the law, leaving all contentions of the parties open for consideration.

In conclusion, the High Court made the Rule absolute in the terms mentioned, with no orders as to costs, and instructed all concerned parties to act on an authenticated copy of the order for further proceedings.