Appellate Authority had no power to condone delay after expiry of one month beyond prescribed period of limitation

The Hon'ble Rajasthan High Court in Consultancy Services (P.) Ltd. v. Deputy Commissioner[D.B. Civil Writ Petition No. 2957 of 2024 dated April 01, 2025] dismissed a writ petition in limine where an appeal was filed against the assessment orders which were admittedly beyond period of limitation prescribed under the Central Goods and Service Tax Act, 2017 ("the CGST Act"). Nowhere, it had been stated in memo of petition by Assessee that at any point of time, that the request was made by Assessee for condoning delay. Even otherwise, the Appellate Authority had no power to condone delay, after expiry of one month beyond prescribed period of limitation. Hence, the Appellate Authority had rejected the appeal filed by Assessee after expiry of limitation period prescribed under GST Act.

that when a statutory appeal is filed beyond the maximum limitation period under Section 107 of the Central Goods & Services Tax Act, 2017 ("the CGST Act"), such delay cannot be condoned.

Facts:

Akshansh Consultancy Services (P.) Ltd. ("the Petitioner") were served a notice by the assessing authority. The Petitioner claimed that the assessing authority had wrongly assessed the tax and imposed interest and penalty in an arbitrary manner. The Petitioner stated that due to medical reasons, Form GSTR-1 and Form GSTR-3B for March and April 2023 could not be filed on time.

Initially, the Petitioner submitted a rectification application and subsequently filed an appeal under Section 107 of the CGST Act. However, the appeal was dismissed by the Appellate Authority as time barred.

The Petitioner appealed against the Assessment Orders dated June 13, 2023 and May 19, 2023 ("the Impugned Orders") on October 26, 2023, which was admittedly beyond the period of limitation, alleging that tax, interest, and penalty were imposed in a mechanical and arbitrary manner based on erroneous assumptions.

Hence, aggrieved by the Impugned Orders, the Petitioner has filed the present writ petition.

Issue:

Whether Appellate Authority had no power to condone delayafter expiry of one month beyond prescribed period of limitation?

Held:

The Hon'ble Rajasthan High Court in D.B. Civil Writ Petition No. 2957 of 2024held as under:

· Noted that, appeal against the Impugned Orders was beyond the period of limitation. Nowhere, it was stated in the memo of petition by the Petitioner that at any point of time, request was made by the Petitioner for condoning the delay. Even otherwise, in view of Section 107(4) of the CGST Act, the Appellate Authority had no power to condone the delay, after expiry of one month beyond the prescribed period of limitation. Hence, the Appellate Authority had rightly rejected the appeal filed by the Petitioner after expiry of the limitation period prescribed under the CGST Act.

· Relied on, Assistant Commissioner (CT) LTU v. Glaxo Smith Kline Consumer Health Care Ltd. [(2020) 19 SCC 681], wherein the question before the Hon'ble Apex Court was as to whether the High Court could have entertained the writ petition under Article 226 of the Constitution of India on the ground that the statutory remedy of appeal against that order stood foreclosed by law of limitation. The Hon'ble Supreme Court after examining the question with regard to the maintainability of the writ petition after expiry of statutory limitation period has given a clear verdict that under the circumstances, where the assessee had failed to avail the remedy of appeal within limitation, the High Court cannot entertain the writ petition and the same deserve to be rejected at the threshold.

· Relied on, Hon'ble Supreme Court was relied upon in ThekedarGirraj Prasad Garg v. State of Rajasthan [D.B. Civil Writ Petition No.1615 of 2024, dated 4-4-2024], in which this Court has held that where the assessee has waited for expiry of period of limitation for filing the appeal as well as for expiry of maximum permissible period of condonation, the writ petition is not maintainable.

· Held that, the Petitioner had not come out with a case that the order passed by the assessing authority was either without jurisdiction or was passed in violation of principles of natural justice. There was no illegality or infirmity in the Impugned Orders. Hence, the writ petition was dismissed in limine.

Our Comments:

Section 107 of the CGST Act prescribes "Appeals to Appellate Authority".Section 107(1) of the CGST Act prescribed that any person aggrieved by a decision or order passed under the CGST Act may file an appeal before the Appellate Authority within 3 months from the date on which the said decision or order is communicated to such person.

The Commissioner may, on his own motion, or upon request from the Commissioner, call for and examine the record of any proceedings in which an adjudicating authority has passed any decision or order, for the purpose of satisfying himself to check the legality or propriety of the decision or order and may, by order, direct any officer subordinate to him to apply to the Appellate Authority within six months from the date of communication of the said decision or order for the determination of such points arising out of the said decision or order as may be specified by the Commissioner in his order in accordance with Section 107(2) of the CGST Act.

Further, the Appellate Authority may, if satisfied was prevented by sufficient cause from presenting appeal within 3 months or 6 months, allow a further extension of 1 month under Section 107(4) of the CGST Act.

In contrary to this judgement, the Rajasthan High Court in the case of Molana Construction Company [D.B. Civil Writ Petition No. 12076 OF 2024]held that while the appellate authority cannot condone delay beyond the limit under Section 107 of the CGST Act, the High Court can intervene under Article 226 in the interest of justice, equity & good conscience. It quashed the dismissal order and restored the appeal, subject to payment of late fee, penalty, and statutory dues by the petitioner.

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