Patna High Court Overturns GST Appeal Dismissal Citing Conditions in Notification No. 53 of 2023-Central Tax

Emphasizing the significance of adhering to statutory timelines while recognizing the opportunities provided by relevant notifications to revive dismissed appeals under specific conditions, the division bench of Chief Justice K. Vinod Chandran and Justice Rajiv Roy stated, “In this context, noticing the Notification, we also make it clear that wherever we have rejected the writ petitions filed against orders; rejecting appeals for reason of delay being beyond that prescribed under Section 107(4) of the BGST Act; the assessee would be entitled to invoke the said remedy de hors the orders of this Court and avail of the benefit of Notification aforementioned, subject to the conditions therein being satisfied.”

“The Commissioner, State Taxes, Government of Bihar shall issue necessary instructions to the officers empowered under the Act to carry out assessment and also consider appeals about the orders of this Court, which permits appeals to be restored on the conditions in this Notification being scrupulously complied with even in cases where this Court has rejected the writ petitions filed against the dismissal of the delayed appeals, solely on the ground of delay occasioned,” the Court added

The above ruling came in a writ petition challenging an order in an appeal filed under the Bihar Goods and Services Taxes Act, 2017, for brevity, (BGST Act), which was dismissed on the ground of delay.

Notably, Section 107 of the BGST Act provides for three months time to file an appeal and a further time of one month in which an appeal could be filed with satisfactory explanation, for the delay occasioned.

The appeal filed in the above case, rejected, was beyond even the one month period provided under Section 107 of the BGST Act.

The High Court as well as the Supreme Court have previously held that when there is a specific period provided in the statute, within which period a delayed appeal could be filed; then neither the Appellate Authority nor this Court under Article 226 of the Constitution of India could condone the delay beyond the period provided.

The Court highlighted that, as per Notification No. 53 of 2023- Central Tax, dated 02.11.2023 (S.O. 4767(E)), issued by the Central Board of Indirect Taxes and Customs, the time for filing appeals against orders made by the Proper Officer under Sections 73 and 74 of the BGST Act, originally due on or before 31.03.2023, has been extended.

The Court observed that this extension also surpasses the one-month timeframe stipulated in Section 107(4) of the BGST Act for filing appeals, provided the special procedure outlined in the aforementioned Notification is adhered to.

Consequently, the Court emphasized that appeals against orders under Section 73 or 74 must now be submitted by 31.01.2024. It further acknowledged that any appeals already in process before the relevant authority will be considered valid, even if there was a delay in filing, as long as they adhere to the procedures outlined in the Notification.

The Court further noted, “However, the maintainability of the appeal is further regulated by paragraph no. 3 which require that the admitted tax, interest, fine, fee and penalty arising from the impugned order is paid up along with a sum equal to 12.5% of the remaining amount of tax in dispute arising from the said order subject to a maximum of twenty-five crore rupees; out of which 12.5%, 20% should have been paid by debiting from the Electronic Cash Ledger. The further conditions in paragraph no. 4 to 6 also shall be applicable.”

The Court emphasized that the appeal had been submitted and subsequently dismissed by the initial Appellate Authority. Given this context, the Court deemed it appropriate to reinstate the appeal to the Authority's records, contingent upon meeting the conditions outlined in paragraph no. 3.

The Court held, “Hence the petitioner would be entitled to satisfy paragraph no. 3 of the aforesaid Notification by paying up the deficient amounts as would be required to maintain the appeal under the notification.”

“We specifically says the deficient amount, since on filing the appeal 10% of the amount of tax in dispute arising from the order impugned would/ought to have been remitted,” the Court added while allowing the appeal.

The Court set aside the impugned order and directed the assessee to satisfy the aforesaid conditions before the time stipulated in Notification; i.e. 31.01.2024, in which event, the appeal would be taken up and considered on merits. The Court said that if the conditions will not be satisfied, then necessarily the appeals ought to be rejected or would stand rejected.

Appearance : For the Petitioner/s : Mr. Anurag Saurav, Advocate For the Respondent/s : Dr. K.N. Singh, ASG

Case Title: M/s Micro Zone vs The Union of India and Ors

LL Citation: 2023 LiveLaw (Pat) 152

Case No.: Civil Writ Jurisdiction Case No.15687 of 2023

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