2025 (3) TMI 104 - HC - GST

Dismissa of appeal solely on the ground of a two-day delay in filing the appeal - HELD THAT - Admittedly order under appeal was passed on 20.12.2023 which was communicated to the petitioner through e-mail on 22.12.2023. In terms of Section 169 of 2017 Act one of the mode of communication is by e-mail. From the date of communication appeal is filed on 90th day. Section 107 of KGST Act 2017 provides three months time to file appeal from the date of order or from the date of communication. Even otherwise the petitioner had filed rectification application and along with rectification application petitioner had also filed application along with affidavit praying to condone the delay if any in preferring the appeal. If such rectification application along with application for condonation of delay is filed second respondent ought to have exercised its power under Section 107 (2) of 2017 Act judiciously since the appeal was presented within the condonable period. The respondent No. 2 failed to apply its mind judiciously and failed to take a decision in terms of Section 107 (2) of 2017 Act. Conclusion - The dismissal of the appeal based on a minor delay was unjustified and it is directed that the second respondent shall hear the appeal on its merits. Petition disposed off.

ISSUES PRESENTED and CONSIDERED:

1. Whether the second respondent erred in dismissing the appeal solely on the ground of a two-day delay in filing the appeal?

2. Whether the second respondent failed to exercise its power under Section 107 of the CGST/SGST Act, 2017 judiciously by not entertaining the appeal and passing an order on merits?

ISSUE-WISE DETAILED ANALYSIS:

Issue 1: The dismissal of the appeal based on a two-day delay

- Relevant legal framework and precedents: The petitioner filed an appeal under Section 107 of the CGST/SGST Act, 2017 within 90 days of receiving the impugned order, as allowed by the Act.

- Court's interpretation and reasoning: The Court found that the second respondent dismissed the appeal solely due to a two-day delay in filing, without considering the appeal's timeliness or providing an opportunity for a hearing.

- Key evidence and findings: The impugned order was communicated to the petitioner via email on 22.12.2023, and the appeal was filed on the 90th day, well within the statutory time limit.

- Application of law to facts: The Court held that the dismissal based on a minor delay was unjustified, especially considering the appeal was filed within the prescribed period.

- Treatment of competing arguments: The respondent argued that the order was uploaded on the portal on the same day, but the Court did not find this argument compelling in justifying the dismissal of the appeal.

- Conclusions: The Court set aside the dismissal of the appeal and directed the second respondent to hear the appeal on its merits.

Issue 2: Failure to exercise power under Section 107 of the CGST/SGST Act, 2017

- Relevant legal framework and precedents: Section 107 of the Act provides for a three-month period to file an appeal from the date of the order or communication.

- Court's interpretation and reasoning: The Court held that the second respondent failed to exercise its power judiciously under Section 107(1) and (2) by not entertaining the appeal and passing an order on merits.

- Key evidence and findings: The petitioner also filed a rectification application along with an affidavit seeking to condone any delay in filing the appeal, which the second respondent did not consider.

- Application of law to facts: The Court found that the second respondent's failure to consider the rectification application and the condonable delay was a failure to apply the law judiciously.

- Treatment of competing arguments: The respondent's argument that the appeal was beyond the prescribed period was not accepted by the Court, which emphasized the need for a fair hearing before rejecting an appeal.

- Conclusions: The Court set aside the orders and directed the second respondent to hear the appeal filed by the petitioner on its merits.

SIGNIFICANT HOLDINGS:

- The Court held that the dismissal of the appeal based on a minor delay was unjustified and directed the second respondent to hear the appeal on its merits.

- The Court emphasized the need for the second respondent to exercise its powers judiciously under Section 107 of the CGST/SGST Act, 2017 and consider all relevant factors before rejecting an appeal.

- The orders bearing Appeal No. KGST/AP. No. 209/2023-24 and the consequential rectification order dated 13.01.2025 were set aside, and the second respondent was directed to hear the appeal filed by the petitioner on its merits.

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