Supreme Court allows GST appeal filed outside limitation

Vasudeva Engineering vs. Union of India and others (Punjab and Haryana High Court)

The High Court of Punjab and Haryana, in Vasudeva Engineering vs. Union of India and othersaddressed the issue of delays in filing GST appeals beyond the statutory limitation period as set out in Section 107 of the CGST Act, 2017. The court emphasized that while the law imposes a strict time limit of three months, with an additional permissible period of 30 days, the Appellate Authority is bound by these provisions and has no discretion to grant further delays. The Supreme Court, however, invoked its jurisdiction under Article 226 of the Constitution and ruled that it retains the power to condone such delays in appropriate cases to prevent companies from being imposed remedial measures.

The court underlined that the primary purpose of the GST law is to provide relief to businesses. Denying appeals due to procedural delays, especially where advance deposits have been made, undermines this goal. In condoning the delay, the court directed the Appellate Authority to consider and decide the cases on their merits without further debate on the limitation or compliance with the advance deposit. This decision is consistent with previous rulings that set aside procedural barriers to ensure substantive justice for injured taxpayers. The judgment reinforces the balance between adhering to legal timelines and the broader constitutional mandate to guarantee access to justice.

FULL TEXT OF THE JUDGMENT/ORDER OF PUNJAB AND HARYANA HIGH COURT

1. This decision will dispose of 17 petitions, namely CWP-27468-2023, CWP-18475-2023, CWP-26077-2023, CWP-18591-2023, CWP-5397-2023, CWP-7816-2024, CWP- 8517-2024, CWP-12742-2024, CWP-13358-2024, CWP-22946-2024, CWP-15632-2024, CWP-7684-2024, CWP-10089-2024, CWP-10105-2024, CWP-16348-2024, CWP-16353-2024 and CWP-24025-2024 are a common problem.

2. The short question arising in all these petitions is whether the Appellate Tribunal hearing appeals under Section 107 of the Act was legally correct in dismissing the appeals filed after the requisite period laid down in Haryana Goods and Services Tax. Act, 2017 (abbreviated ‘the Act’). We find that though the petitioners had paid the deposit for the hearing of the appeal, it is an admitted position that the appeals have been filed after the period of limitation, even after the period which could be allowed under the provisions of Article 107 and 35. (1) of the Act, although the said provision provides for a period of three months for filing an appeal with an additional period of 30 days for conciliation, the provisions under section 107 are not liable to the Limitation Act and therefore the delay cannot be imposed. further condoned. Forgiveness is granted on the basis of the law itself. In view of this, it cannot be said that the conduct of the Appellate Body in dismissing the appeals is illegal or unjustified. But darling Supreme Court in the case of M/s Tecnimont Pvt. Ltd. vs. State of Punjab and others 2019 INSC 1054the similar issue relating to non-deposit of in cases where the pre-deposit had not been made, and the appeals were dismissed before the Supreme Court where the Hon’ble Supreme Court observed that the order was not unwarranted by dismissing the appeals but left it to the High Court to exercise its jurisdiction under Article 226 taking into account the facts of each case to condone the requirement of advance payment in the case of M/s steel kart vs. State of Haryana and othersentered CWP-17348-2024 considered before this Court a matter challenging the order impugned on appeal as the petitioner did not have knowledge thereof within the prescribed period and this Court exercised its powers under Article 226 and directed the Appellate Authority to consider the petitioner’s appeal ( s) on the merits, without going into the issue of delay/restriction. It is therefore clear why the Appellate Authority concerned would be bound by the provisions of the Act; this would in no way limit the powers provided for under Article 226 of this Court to exercise its jurisdiction in the facts of the case and condoned the delay.

3. The provisions of the said Act of 2017 are intended to provide relief to the businessman in appropriate cases, where the claim may have been filed wrongly or illegally by preferring appeal. If the businessman is unable to appeal due to delay which may occur due to various reasons related to business matters, he/she becomes less recourse. The cancellation of GST registration has a cascading effect on all other businessmen who receive the goods from the concerned businessmen whose GST registration has been cancelled. Therefore, in these circumstances it is essential that a final decision is made between the decision to withdraw registration and at the same time that a legal remedy is available that is effective for the affected person concerned.

4. Accordingly, we are of the view that the powers to entertain the appeal under section 107 of the Act are not subject to filing of an appeal within the prescribed period, which would in no way deprive any person of the claiming the right to hear an appeal by filing a petition with the court for forgiveness of the delay.

5. Now considering the aforesaid issue which is purely legal, we find that there is no need to file any reply from the respondents and we have also condoned the delay as the petitioner(s) have already submitted the advance amount for the consideration of the profession. .

6. The appeals will be heard and decided on the merits by the Appellate Body, preferably within three months from today.

7. With the above observations, the present requests are well-founded.

8. Any ongoing miscellaneous requests will also be processed.