The Jharkhand High Court has held that a delay of 17 months cannot be condoned under the Section 107 of the Central Goods and Services Tax Act, 2017 as the prescribed limitation period is only of three months.

The Court was considering a Writ Application seeking quashing and setting aside the order whereby Appeal preferred by the Petitioner was ejected on the ground of being filed after expiry of period of limitation as prescribed under Section 107 of the Central Goods and Services Tax Act, 2017.

The division bench of Chief Justice M. S. Ramachandra Rao and Justice Deepak Roshan observed, "Even otherwise, since specific period has been enshrined in the statute itself, the same cannot be condoned. Thus, we are having no hesitation in holding that the petitioner Firm is not entitled for any relief on the ground of being lethargic in approach, inasmuch as, on the one hand, the petitioner did not file its return for a continuous period of six months and on the other hand, petitioner-Firm filed appeal before the appellate authority after a delay of almost 17 months which is admittedly beyond the period of three months for filing appeal as prescribed under Section 107 (1) of the CGST Act, 2017."

The Applicant was represented by Advocate Ranjeet Kushwaha while the Respondent was represented by Senior Standing Counsel Amit Kumar.

Facts of the Case

The Petitioner had prayed for quashing and setting aside the order for cancellation of registration wherein GST registration certificate of the Petitioner was cancelled on the ground that Petitioner failed to furnish the returns for a continues period of Six months. The Petitioner, a Partnership Firm was engaged in the business of transportation (loading and unloading services) and after coming of Goods and Services Act regime, it obtained registration certificate in Form GSTREG-06. The case of the Petitioner was that though, initially, he was regularly filing its return under the GST Act, however, from April, 2022 to September, 2022 service recipients of the Petitioner firm were not releasing its bill due to which the firm was adversely affected.

A show cause notice was issued to the Petitioner on the ground that the Petitioner had not filed its return for a continuous period of six months. The Petitioner filed its reply, however, the impugned order was passed cancelling the registration of the Petitioner under Section 29 of the CGST Act. Thereafter, Petitioner filed an Appeal after the period of limitation of three months and accordingly, the Appeal was also rejected.

Counsel for the Petitioner submitted that though initially, he was filing its return regularly through its accountant, however, his business was adversely affected due to non-releasing of bills by the recipient of the petitioner firm and only due to that reason he could not file the returns as mandated under the Act. He further contended that due to medical reasons, Petitioner could not take part in day-to-day business activities and accordingly, it could not file the statutory appeal within the period of limitation and the appellate authority rejected the Appeal only on the ground of limitation and has not decided the same on merit; as such, the impugned order should be quashed and set aside.

Reasoning By Court

The Court at the outset noted that the Petitioner, after a lapse of almost 17 months from the date of passing of impugned order of cancellation of registration filed an appeal and the appellate authority rejected the appeal on the ground of limitation

Noting that under Section 107 of CGST Act, 2017, there is a period of limitation of 3 months prescribed, however, it pointed out that the Petitioner filed the Appeal not only beyond the period of limitation of few days; rather he filed the Application after a delay of almost 17 months and no reasons have been assigned.

"At this stage, it is also necessary to indicate that Section 107 of CGST Act, 2017 clearly stipulates the timing for filing appeal of three months and if the appellate authority is satisfied that the assessee was prevented by sufficient cause for presenting the appeal within the aforesaid period of three months, then, he may allow a further period of one month," the Court observed.

The Appeal was accordingly dismissed.

Cause Title: M/s. Bokna Raiyat Rojgar Committee vs. The Union of India (2024:JHHC:44324-DB)

Appearances:

Applicant- Advocate Ranjeet Kushwaha

Respondent- Senior Standing Counsel Amit Kumar, Junior Standing Counsel Anurag Vijay, Assistant Counsel to Senior Standing Counsel Srijan

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Jharkhand High CourtChief Justice Ramachandra RaoJustice Deepak Roshan

Sheetal Joon