Case Law Details
Bhagwati Industries Vs Union of India (Rajasthan High Court)
The Rajasthan High Court considered a writ petition filed by the petitioner seeking directions to the respondents to entertain an appeal against the Order in Original dated 28.11.2025 passed by the Assistant Commissioner, CGST Division, Sikar, and to condone the delay in filing the appeal. The impugned order had raised a GST demand of ₹79,85,472 for Financial Years 2018-19 and 2023-24 on account of alleged non-payment of tax under the Reverse Charge Mechanism (RCM) on royalty, DMET and RMSET/NMET expenses. The petitioner filed the writ petition on 03.07.2026 after being unable to file the statutory appeal because the GST portal reflected the appeal as time-barred.
The petitioner submitted that the delay occurred due to lack of knowledge regarding the GST portal, appellate procedures and technical provisions of GST law, as well as because the adjudication order had only been uploaded on the GST portal without any communication to him. It was further contended that immediately after becoming aware of the order, steps were taken to file the appeal, but the portal prevented its filing owing to limitation.
The petitioner also submitted that the delay was bona fide. It was stated that the petitioner had discontinued business since 2024, had nil turnover, and had completely closed the business. Being not fully educated and unfamiliar with the GST portal, the petitioner relied upon the Chartered Accountant and Accountant for GST compliances and remained unaware of the Show Cause Notice and adjudication order. It was further submitted that closure of the business caused severe financial distress, resulting in depression and ill health, for which the petitioner remained under medical treatment.
Relying upon earlier Division Bench judgments of the Rajasthan High Court, namely M/s M R Traders v. UOI, M/s Molana Construction Company v. Central Goods and Service Tax Department & Anr., Man Singh Tanwar v. Commissioner, Central Goods and Services Tax Department & Ors., and two decisions in RPC PSIPL JV Vs. State of Rajasthan & Ors., the petitioner argued that sufficient cause had been shown for the delay and that the appeal should be directed to be heard on merits after condonation of delay.
The respondents opposed the writ petition and submitted that the impugned order had been validly passed and that the appeal was barred by limitation.
The High Court observed that although the Appellate Authority is bound by the statutory limitation prescribed under Section 107 of the RGST/CGST Act, 2017, the reasons for the petitioner’s inability to file the appeal within the prescribed period were beyond the petitioner’s control. The Court further observed that refusal to adjudicate the appeal on merits would cause grave injury and prejudice to the petitioner.
The Court noted that in the judgments relied upon by the petitioner, it had consistently directed that such appeals be entertained on merits. Following the same view, the Court allowed the writ petition to the extent of condoning the delay in filing the appeal.
Accordingly, the Court directed the Appellate Authority to entertain the petitioner’s appeal and adjudicate it on merits, provided the appeal is filed within 30 days from the date the present order is uploaded on the website of the High Court.
With regard to the challenge to the validity of Section 107(4) of the CGST Act, 2017, the petitioner’s counsel stated that the challenge was not being pressed in the present proceedings, while reserving liberty to raise it in appropriate proceedings. The High Court left the issue relating to the vires of Section 107(4) open for adjudication in future proceedings.
All pending applications were disposed of.
Cases Discussed
- RPC PSIPL JV Vs. State of Rajasthan & Ors., D.B. CWP 11794/2025
- RPC PSIPL JV Vs. State of Rajasthan & Ors., D.B. CWP 7260/2025
- Man Singh Tanwar v. Commissioner, Central Goods and Services Tax Department & Ors. (Rajasthan High Court), D.B. CWP 14658/2024
- M/s Molana Construction Company v. Central Goods and Service Tax Department & Or. (Rajasthan High Court), 2024 SCC OnLine Raj 3938
- M/s M R Traders v. UOI (Rajasthan High Court), 2026 SCC OnLine RAJ 2115
FULL TEXT OF THE JUDGMENT/ORDER OF RAJASTHAN HIGH COURT
The petitioner herein, inter alia, seeks a direction commanding respondents to entertain the appeal and also condone the delay and allow the filing of appeal against the impugned Order in Original, dated 28.11.2025 (Financial Years 2018-19 and 2023-24) passed by the Office of Assistant Commissioner, CGST Division, Sikar, whereby GST demand of Rs.79,85,472/- for Financial Years 2018-19 and 2023-24, was raised on the account of non-payment of tax on Reverse Charge Mechanism (RCM) on royalty, DMET and RMSET/NMET expenses by the petitioner. The appeal against the said orders could not per force be filed before the Appellate Authority as the online status of the appeal would reveal that the same is time-barred. The petitioner is thus left remediless. Aggrieved by the same, petitioner filed the instant writ petition on 03.07.2026.
2. The learned counsel for the petitioner submits that the delay in filing the appeal occurred on account of lack of knowledge in regard with GST portal, appellate procedures and technical provisions under GST law on the part of the petitioner and non-information regarding the impugned order as the same was merely uploaded on the GST portal. The petitioner contends that due to such technicalities, he could not file the appeal within the prescribed period, where after he immediately took steps to prefer the appeal but the appeal against the said order could not per force be filed before the Appellate Authority as the online status of the appeal would reveal that the same is time-barred.
2.1 He further contends that the delay in filing the appeal is bona fide and deserves to be condoned, as the petitioner has not been carrying on any business since 2024, has nil turnover, and has completely closed down the business. Being not fully educated and unfamiliar with the functioning of the GST portal, the petitioner was entirely dependent upon his Chartered Accountant and Accountant for GST compliances and remained unaware of the issuance of the Show Cause Notice and the adjudication order, as no information was communicated to him. Further, the closure of the business caused severe financial distress, resulting in depression and ill health, for which the petitioner remained under medical treatment.
3. In the aforesaid backdrop, we have heard the learned counsels for the parties and perused the record.
4. Learned Counsel for the petitioner, relying on the various Division Bench judgments of this very Court in M/s M R Traders v. UOI1, M/s Molana Construction Company v. Central Goods and Service Tax Department & Or2, Man Singh Tanwar v. Commissioner, Central goods and Services Tax Department & Ors.3, RPC PSIPL JV Vs. State of Rajasthan & Ors.4 and RPC PSIPL JV Vs. State of Rajasthan & Ors.5 argues that sufficient cause of delay in filing the appeal due to circumstances beyond control has been shown and thus appeal be directed to be considered on merits after condoning the delay by this Court.
5. Learned counsels for the respondents oppose the above submission and contends that the impugned order has rightly been passed and appeal is now barred by limitation.
6. Having heard, as above, it transpires that while it is true that the Appellate Authority is bound by the statutory provisions of limitation provided under Section 107 of the RGST/CGST Act, 2017, however, considering the reasons owing to which the petitioner could not submit its appeal within the stipulated time, being beyond its control, non-adjudication of appeal on merits would cause grave injury and prejudice to the petitioner.
7. In the judgments cited above, this Court, while allowing the writ petitions, have issued directions to entertain the appeal on merits.
8. In the premise, following the consistent view as already taken by this Court, ibid, we allow the present writ petition to the extent of condoning the delay in filing of the appeal by the petitioner.
9. Accordingly, the Appellate Authority shall now entertain the appeal of the petitioner and adjudicate the same on merits, provided the same is filed within 30 days of the instant order being uploaded on the website of this court.
10. Before parting, we may also hasten to add that as regards challenge to the validity of Section 107(4) of the CGST Act, 2017 and in view of the aforesaid order passed by this Court, learned counsel for the petitioner submits that the said challenge is not being pressed in the present matter, with liberty to raise and pursue the same in appropriate proceedings. The issue qua the vires of the same is thus left open to be adjudicated in appropriate proceedings in future.
11. All pending application(s) stand disposed of.
Notes:
1 2026 SCC OnLine RAJ 2115
2 2024 SCC OnLine Raj 3938
3 D.B. CWP 14658/2024
4 D.B. CWP 7260/2025
5 D.B. CWP 11794/2025
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