2025 (3) TMI 172 - HC - GST

Condonation of delay in filing appeal - Wrongful availment of Input tax credit - HELD THAT - It appears that the pre-deposit amount was already deposited by the petitioner before formal dismissal of the appeal. It is informed to the Court that in the month of December 2022 filing of appeal through electronic mode was not mandatory and the appeal could be filed manually also. There is nothing on record to show that any notification has been issued by which the manual filing of appeal was prohibited in the month of December 2022. An appeal through electronic mode could not be filed until and unless the impugned order is uploaded on the GST portal. In the present matter the impugned order was uploaded on 17.01.2023 and therefore the petitioner could not file the appeal through electronic mode earlier therefore petitioner has not committed any error in depositing Rs.82, 000/- in his GST Electronic Cash Ledger and submitting the appeal through speed post. There was no failure on the part of petitioner in filing the appeal within the prescribed period of limitation as well as depositing the mandatory amount in accordance with Section 107 (6b) of CGST Act 2017. Merely because the petitioner could not pay the mandatory amount through GST APL - 01 in the absence of uploading the Order in Original petitioner cannot be held liable for transferring the amount in his GST Electronic Cash Ledger as no other option was available with the petitioner. In the facts and circumstances of the present case the petitioner has sufficiently complied with the provisions of Section 107 and filed the appeal within condonable period and pre-deposited the amount through challan on 22.12.2022. Conclusion - This Court is of the view that the appeal should not be dismissed merely due to a procedural delay especially when the petitioner has made an effort to comply with the statutory requirements including the predeposit of 10% of the tax liability and additional payments towards the disputed tax amount. The delay in preferring the appeal is hereby condoned. Petition allowed.

Summary

The High Court of Madhya Pradesh considered a case where the petitioner, a proprietor of M/s Swastik Traders, was engaged in the business of General Stores and registered under the Central Goods and Services Tax Act, 2017. The petitioner filed statutory returns for the period of April 2018 to March 2019. Following a GST audit, a show cause notice was issued proposing a tax demand for the difference in Input Tax Credit claimed by the petitioner and assessed by the department. The Assessment Officer held that the petitioner wrongly availed Input Tax Credit and imposed a tax demand and penalty. The petitioner challenged this decision through an appeal.The core issue before the Court was whether the petitioner had complied with the procedural requirements for filing an appeal under the CGST Act, 2017. The Court analyzed the timeline of events, including the deposit of a pre-deposit amount, the filing of appeals offline and online, and the timing of the appeal submissions in relation to the communication of the original order.The petitioner argued that they had deposited the required pre-deposit amount in their GST Electronic Cash Ledger and had submitted the appeal within the prescribed time frame. The respondent, representing the revenue department, contended that the appeal was not submitted within the specified period.The Court examined the provisions of Section 107 of the CGST Act, 2017, regarding the time limit for filing appeals and the requirement of making a pre-deposit. The Court noted that the order in original was uploaded after the petitioner had already deposited the pre-deposit amount and submitted the appeal through speed post. The Court found that the petitioner had complied with the statutory requirements and had not erred in the deposit and submission of the appeal.Ultimately, the Court allowed the petition, quashed the Order in Appeal passed by the Joint Commissioner, and remitted the matter back to the authority for a fresh decision on merits. The Court emphasized that the appeal should not be dismissed solely due to procedural delays when the petitioner had made efforts to comply with the statutory requirements. The Court condoned the delay in preferring the appeal and directed the authority to decide the matter afresh after giving the petitioner an adequate opportunity.In conclusion, the Court held that the petitioner had fulfilled the requirements of Section 107 of the CGST Act, 2017, and allowed the petition, setting aside the Order in Appeal and directing a fresh consideration of the matter on its merits.