2022 (11) TMI 899 - HC - GST

Maintainability of appeal - appeal rejected on the ground of time limitation - Section 107 of the Central Goods and Service Tax Act, 2017 - HELD THAT - Perusal of the pleadings would reveal that inspite of all the circulars and notifications that have been issued by the Central Government the petitioner as such has not moved any application for revocation during the period that was extended by way of the aforesaid circulars and notifications. Without moving an application for revocation the petitioner has straightaway thought of preferring an appeal before the appellate authority and which now stands decided vide Annexure P/2 dated 30.09.2021. Without availing the remedy of revocation which was permissible under the ROD dated 25.06.2020 and subsequent notification dated 29.08.2021 followed by the clarificatory circular issued on 06.09.2021, the petitioner as such cannot claim any advantage of showing justification for the delay in the filing of the appeal beyond the permissible period of limitation under the Act. Further contention of the petitioner also is that the petitioner was an IBC Company and for which there was a circular No.134/04/2020-GST dated 23.03.2020 which provided that the companies under IBC the registration could not have been cancelled - This circular again would not come to the rescue of the petitioner for the reason that the registration of the petitioner already stood cancelled on 04.09.2019 i.e. much before the said circular dated 23.03.2020 came into force. Under the then prevailing provision of law, the only recourse available to the petitioner was to promptly challenge the same in accordance with law before the appellate authority within the time limit stipulated therein. The petitioner for reasons best known did not choose to prefer an appeal during the period of limitation and also within a reasonable period of time. The appeal has been filed after more than 1 and years of time before the appellate authority who thereafter was not having any further powers to condone the inordinate delay that had occurred in the filing of the appeal. The impugned order in the given circumstances seems to be fair, reasonable, proper and justified and does not warrant any interference - Petition dismissed.

Summary

Issues:
1. Appeal against the order of cancellation of registration rejected on the ground of limitation.
2. Interpretation of relevant notifications and circulars regarding the timeline for filing an appeal.
3. Claim of advantage for delay in filing appeal due to justifiable grounds.
4. Applicability of circular protecting registration of companies under IBC.
5. Failure to challenge the cancellation of registration promptly within the stipulated time.

Analysis:
1. The High Court dealt with a writ petition challenging the rejection of an appeal against the cancellation of registration due to a delay in filing the appeal beyond the prescribed period. The appellate authority rejected the appeal citing limitation as the sole ground.

2. The petitioner argued that certain Removal of Difficulties (ROD) issued by the Central Government and subsequent notifications extended the timeline for filing applications for revocation of cancellation of registration. However, despite these extensions, the petitioner did not avail the remedy of revocation and directly filed an appeal beyond the permissible period.

3. The court emphasized that without moving an application for revocation during the extended period as permitted by circulars and notifications, the petitioner could not claim justification for the delay in filing the appeal. The failure to utilize the available remedy precluded the petitioner from seeking leniency for the delay.

4. The petitioner contended that being an IBC Company, a circular dated 23.03.2020 protected companies under IBC from registration cancellation. However, the court noted that the registration was canceled before the circular came into effect, and the petitioner had the obligation to challenge the cancellation within the stipulated time.

5. The court observed that the petitioner did not promptly challenge the cancellation of registration within the prescribed time limit or within a reasonable period thereafter. Filing the appeal after a significant delay of over a year and a half left the appellate authority with no power to condone such inordinate delay. Consequently, the court found the impugned order fair, reasonable, and justified, leading to the dismissal of the writ petition.