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2023 (8) TMI 524 - HC - GSTRecovery of dues from the partners of the partnership firms - Service of the other - Inability to file appeal - Rejection of refund claim twice in two separate claim for the same period and matter - absence of uploading of the Orders-In-Original (but communicated manually) - Refund of Unutilized Input Tax Credit - Section 107 of the Central Goods and Services Tax Act, 2017 (CGST) and Rule 108 of the Central Goods and Services Tax Rules, 2017 and related provisions. Were the petitioners prevented from filing their appeals through the electronic mode merely because the orders were not uploaded, when it is undisputed that the petitioners otherwise were communicated the orders and had received the same manually? HELD THAT - Reading Section 107 indicates that any person aggrieved by any decision or order passed under this Act may appeal to the Appellate Authority as may be prescribed within three months from the date on which the said decision or order is communicated to the person. The Appellate authority has power if sufficient cause is shown that the appellant was prevented from filing an appeal within three months then it can allow a further period of three months - Rule 108 provides that the appeal has to be filed in the form either electronically or otherwise as may be notified. That no other mode is notified and the only mode is an electronic mode is accepted. (the old rule, before amendment shall apply in present case). Section 169 talks about service of notice in certain circumstances. Reading the Section indicates that any decision or order shall be served by giving or tendering it directly or by a messenger including a courier to the addressee of the taxable person. Section 37C also provides that any decision shall be served by tendering the same to the person to whom it is intended to be so served. Heavy reliance is placed by the learned counsel for the petitioners on the judgement of this Court in the case of Gujarat Petronet 2020 (9) TMI 427 - GUJARAT HIGH COURT . Reading the judgement in its entirety would indicate that the petitioner therein could not file an appeal due to technical glitches on the portal - Reading the judgement indicates that firstly the order was not uploaded and that there were technical glitches so also appeal could not be filed. The order was served manually. The only question that the Court decided is whether the limitation would begin to run from the date of service of the manual copy of the order or the uploaded one. The court therefore was only considering the question of counting of limitation in filing the Appeal - Here too, the order was served manually and the appeal was filed manually and therefore the Court observed that the only mode available is of filing the appeal electronically which can be availed of only when order is uploaded. The judgement cannot be read to mean that no appeal can be filed at all unless the order is uploaded. The purpose of the judgements are only to consider the question of limitation. The Bombay High Court recently had an occasion to consider this issue in the case of Meritas Hotel 2021 (12) TMI 376 - BOMBAY HIGH COURT . The point for consideration was whether in the facts of the case the period of limitation for the purpose of filing the appeal under Section 107 of the Act would commence from the date of service upon the petitioner of the scanned copy or from the date of uploading - In para 12 of the judgement, it has been held that Rule 108 no doubt prescribes that the appeal has to be filed electronically, but it nowhere prescribes that the same is to be filed only after the impugned order is uploaded on the GSTN Portal. The date of communication of the order by email was taken as the date of communication of the order for the purposes of limitation. The Bombay High Court held that the decision in Gujarat Petronet was rendered in a different situation. The authorities therein could not upload the order due to the technical glitches. The Bombay High Court held that once the assessment order had become final as the petitioner had only applied for a copy of the order after the recovery proceedings were initiated, he had lost his statutory right to appeal. In the present case, in both the petitions namely in Special Civil Applications No. 4876 and 5731 of 2023 , the petitioners have filed the appeals only after the orders of recovery have been passed though being aware and being manually served with the orders dated 31.3.2021 and 29.4.2021 and therefore merely because the orders were subsequently uploaded will not render or save their appeals from the same having been time barred especially when recovery proceedings have already been done and orders to debit freeze accounts have been made in exercise of powers under Section 79 of the CGST Act and not as submitted by the learned advocate for the petitioner, under Section 83 of the Act. Section 79(1)(c) of the CGST Act empowers the department to directly debit the amount lying in the bank accounts. As far the case of the partners in these petitions to contend that they are now not liable, Section 90 of the CGST Act provides that the firm and each of the partners of the firm shall be jointly and severally liable for any dues. The section has been a part of the reproduction of the reply in this part of the judgement and hence is not so reproduced. Petition dismissed.
Issues Involved:
1. Interpretation of Section 107 of the Central Goods and Services Tax Act, 2017 (CGST) and Rule 108 of the Central Goods and Services Tax Rules, 2017. 2. Non-uploading of Order-In-Original (OIO) on the GST Portal. 3. Re-credit of rejected refund claims. 4. Limitation period for filing appeals. 5. Recovery proceedings and liability of partners. Summary: Issue 1: Interpretation of Section 107 and Rule 108 of CGST Act and Rules The petitions raised a common question regarding the interpretation of Section 107 of the CGST Act and Rule 108 of the CGST Rules. The court needed to decide whether the petitioners were prevented from filing appeals electronically due to the non-uploading of Orders-In-Original (OIO) on the GST Portal. Issue 2: Non-uploading of OIO on GST Portal In Special Civil Application No. 14867 of 2022, the petitioner argued that the OIO dated 23.08.2019 was not uploaded on the GST Portal, preventing them from filing an appeal electronically as mandated by Rule 108. The court noted that the petitioner received the OIO manually but did not file an appeal. The court held that the non-uploading of the OIO did not prevent the petitioner from filing an appeal, as the manual receipt of the order was sufficient for filing an appeal electronically. Issue 3: Re-credit of Rejected Refund Claims The petitioner in Special Civil Application No. 14867 of 2022 also sought re-credit of the rejected refund claim in their electronic ledger under Rule 93 of the CGST Rules. The court found that the petitioner neither filed an appeal nor provided an undertaking not to file an appeal, as required by Rule 93. Therefore, the request for re-credit was rightly rejected. Issue 4: Limitation Period for Filing Appeals The court examined whether the limitation period for filing appeals began from the date of manual receipt of the OIO or from the date of its uploading on the GST Portal. The court referred to relevant provisions, including Section 107, Section 169 of the CGST Act, and Rule 108 of the CGST Rules. The court concluded that the limitation period commenced from the date the order was manually received, not from its uploading on the GST Portal. Issue 5: Recovery Proceedings and Liability of Partners In Special Civil Applications No. 4876 and 5731 of 2023, the petitioners argued that recovery proceedings initiated under Section 79 of the CGST Act were invalid due to the non-uploading of the OIO. The court found that the petitioners were manually served with the orders and did not file appeals within the prescribed period. The court held that the recovery proceedings were valid and that the partners were jointly and severally liable for the dues under Section 90 of the CGST Act. Conclusion: The court dismissed all petitions, holding that the non-uploading of OIOs on the GST Portal did not prevent the petitioners from filing appeals electronically. The limitation period for filing appeals commenced from the date of manual receipt of the orders. The court also upheld the validity of the recovery proceedings and the joint and several liability of the partners.
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