2025 (1) TMI 115 - HC - GST

Challenge to order passed by the appellate authority dismissing the appeal filed by the appellants as it was time-barred - HELD THAT - Taking note of the fact that the appellants are in possession of certain customs documents and that their contention is that no tax is payable since it was an import transaction on which customs duty has been remitted and also taking into consideration that the appellants have pre-deposited a sum of Rs.1,48,895/- at the time of preferring the appeal, being 10% of the disputed tax and also taking note of the fact that the tax period is from July 1, 2017 to March 31, 2018 i.e. when the GST regime was introduced, this Court is of the view that one more opportunity can be granted to the appellants. It is made clear that this order has been passed without going into the merits of the matter and taking into consideration the peculiar facts and circumstances of the case and also the relevant tax period. The order passed in the writ petition is set aside and the writ petition is allowed and the order passed by the appellate authority and adjudication order passed under Section 73 of the Act dated 17th April, 2023 are set aside and the matter is remanded back to the adjudicating authority for fresh consideration - Appeal allowed.

Summary

1. ISSUES PRESENTED and CONSIDERED

The core legal questions addressed in the judgment are:

• Whether the appellate authority was correct in dismissing the appeal as time-barred.
• Whether the appellants should be granted another opportunity to present their case, given their failure to respond to the show-cause notice and the subsequent dismissal of their appeal.
• Whether the appellants' contention that no tax is payable due to the import nature of the transaction and payment of customs duty was adequately considered.

2. ISSUE-WISE DETAILED ANALYSIS

Issue 1: Dismissal of the Appeal as Time-Barred

• Relevant Legal Framework and Precedents: The appeal was dismissed by the appellate authority as it was filed beyond the condonable period of four months (3+1) as per the applicable legal provisions.
• Court's Interpretation and Reasoning: The court found that the appellate authority acted correctly in dismissing the appeal due to the lack of power to condone the delay beyond the statutory period.
• Key Evidence and Findings: The appeal was filed significantly late, and the appellants did not provide a valid justification for the delay.
• Application of Law to Facts: The court applied the statutory limitation period strictly, affirming the appellate authority's decision.
• Treatment of Competing Arguments: The appellants' arguments regarding the delay were not persuasive enough to warrant a deviation from the statutory limitation rules.
• Conclusions: The dismissal of the appeal as time-barred was upheld as procedurally correct.

Issue 2: Opportunity for Fresh Consideration

• Relevant Legal Framework and Precedents: The court considered the appellants' failure to respond to the show-cause notice and their lack of diligence in the appeal process.
• Court's Interpretation and Reasoning: The court deemed it appropriate to grant another opportunity due to the appellants' possession of customs documents and the peculiar circumstances of the case, particularly the transition to the GST regime.
• Key Evidence and Findings: The appellants had pre-deposited a sum of Rs.1,48,895/- and claimed that no tax was payable due to the import nature of the transaction.
• Application of Law to Facts: The court balanced procedural adherence with fairness, allowing for a fresh adjudication given the specific context.
• Treatment of Competing Arguments: The court acknowledged the appellants' arguments about the import transaction and customs duty payment, deciding these warranted further examination.
• Conclusions: The court allowed the appeal, set aside previous orders, and remanded the matter for fresh consideration.

3. SIGNIFICANT HOLDINGS

• Preserve Verbatim Quotes of Crucial Legal Reasoning: "The appellate authority was right in rejecting the appeal on the ground of it being barred by limitation as he had no power to condone the delay beyond the period of four months (3+1)."
• Core Principles Established: The judgment underscores the importance of adhering to statutory limitation periods while also recognizing the need for equitable considerations in unique circumstances.
• Final Determinations on Each Issue: The court upheld the dismissal of the appeal as time-barred but allowed for a fresh opportunity for the appellants to present their case, remanding the matter for reconsideration by the adjudicating authority.

This judgment reflects a balanced approach, adhering to procedural rules while allowing for fairness in light of the specific facts and circumstances of the case. The court's decision to remand the matter for fresh adjudication ensures that the appellants' arguments and evidence can be fully considered. The appellants are directed to submit their reply with all relevant documents within six weeks, and the adjudicating authority is instructed to provide a personal hearing and make a fresh decision based on the merits.