Any Procedural Deficiency In The Proceeding Filed Within The Prescribed Limitation Cannot Be Labelled To Be A Proceeding Filed Beyond Limitation: Bombay HC
The Bombay High Court has observed that any procedural deficiency in the proceeding filed within the prescribed limitation cannot be labelled to be a proceeding filed beyond limitation.
In the matter, the bench was of the opinion that the original authority erred in refusing the petitioner's refund claim without valid reasons. Additionally, the appellate authority dismissed the appeal on technical grounds, claiming it was time-barred, despite the appeal being filed within the prescribed period. The appellate authority's decision, based on the absence of physical copies and minor document deficiencies, did not consider essential facts and merits of the case. Therefore, the approach was deemed unlawful and inconsistent with the provisions of Sections 107(1) and (4) of the CGST Act.
Accordingly, a bench of Justice G. S. Kulkarni and Justice Firdosh P. Pooniwalla observed, “…any deficiency in filing the appeal / application like failure to file physical documents, cannot make the appeal, which was registered on the online portal within the prescribed period of limitation, to be labelled and/or held to be barred by limitation. Once the appeal was filed (albeit under the Online method) within the prescribed limitation, any deficiency in the appeal certainly could be removed later on, as the law does not provide, that the proceeding be strictly filed sans deficiency, and only then, the proceedings would be held to be validly filed. If such proposition is to be recognized as the correct position, it would not only tantamount to a patent absurdity, but also would result in a gross injustice, prejudicially affecting the legitimate rights of persons to a legal remedy (access to justice)…”.
“Thus, the parties would necessarily have an opportunity to remove the deficiencies, if any, which may prevail at the time of filing of the proceedings, after the proceedings are filed. It may be observed that procedural compliances can never defeat the substantive remedy/right to pursue any proceedings when filed within limitation. Thus, any procedural deficiency in the proceeding filed within the prescribed limitation cannot be labelled to be a proceeding filed beyond limitation”.
Advocate C. S. Lamba appeared for the petitioner Advocates Jitendra B. Mishra, Sangeeta Yadav, Rupesh Dubey appeared for the respondents.
The petitioner argued that the discrepancies in filing returns and depositing taxes under a cancelled registration were bona fide errors by their Chartered Accountant. It was further asserted that the tax deposited under the cancelled registration should be refunded, as returns filed under it were legally void. These crucial facts were allegedly overlooked by the authorities, rendering their orders unlawful. Regarding the appellate authority's decision, the petitioner contended that their online appeal filing on August 8, 2022, should have been considered within the prescribed time limit, despite minor document submission errors. Further that such errors shouldn't invalidate the appeal filing, as it was made within the timeframe stipulated by the CGST Act.
In the present matter, the petitioner was working on contract basis as a scriptwriter. However, his registration was cancelled on January 1, 2019, rendering it ineffective. Subsequently, the petitioner applied for a fresh registration, which was granted on March 26, 2022, with a new registration number. The petitioner's contention was that their Chartered Accountant inadvertently filed returns and deposited taxes under both the cancelled and new registration numbers for the first quarter of 2022, when only filings and tax payments under the new registration were necessary.
The petitioner sought a refund of Rs.1,22,220/- for tax mistakenly deposited under a cancelled registration. After a show cause notice, he challenged the Assistant Commissioner's order. However, his appeal was rejected by the appellate authority on December 28, 2022, citing it was filed beyond the statutory timeframe outlined in Section 107(4) of the CGST Act, despite the earlier decision on June 8, 2022.
The bench noted in the matter the authorities were to recognize that taxpayers cannot be expected to file returns or pay taxes under invalid registration numbers. The petitioner filed a proper return under a valid registration after the first one was cancelled. It's argued that any tax deposited under the cancelled registration shouldn't be retained by authorities, as it wasn't valid.
Appearances:
Petitioner: Advocate C. S. Lamba
Respondent: Advocates Jitendra B. Mishra, Sangeeta Yadav, Rupesh Dubey
Cause Title: Yogesh Rajendra Mehra v. Principal Commissioner CGST & Central Excise Raigad
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