Sunny Enterprises Vs Superintendent of Central Tax (Telangana High Court)
Summary: The Telangana High Court disposed of a writ petition filed by M/s. Sunny Enterprises challenging a summary notice in Form GST DRC-01 dated 11 September 2023, issued under Section 73 of the Central Goods and Services Tax Act, 2017 and the Telangana Goods and Services Tax Act, 2017, and the consequential order-in-original dated 26 December 2024 confirming a tax and penalty demand of ₹10,80,354. The petitioner alleged that the notice had been issued without signatures and challenged the demand on the ground that the adjudicating authority had failed to consider the extraordinary circumstances prevailing during the COVID-19 pandemic in the tax period 2020–21.
During the hearing, the petitioner sought permission to pursue the statutory appellate remedy and requested consideration of the delay in approaching the appellate authority. Counsel appearing for CBIC submitted that all available legal and factual grounds could be raised in the appeal. Without examining the merits of the challenge, the High Court granted liberty to file an appeal within two weeks, accompanied by the statutory pre-deposit and an application for condonation of delay. The appellate authority was directed to consider the delay in light of the facts and circumstances and, if satisfied, decide the appeal on merits in accordance with law. The Court did not decide whether the unsigned Form GST DRC-01 was invalid, whether the demand was sustainable, or whether the COVID-19 circumstances justified relief. The writ petition was disposed of without costs, and pending miscellaneous applications were closed.
Takeaways for GST Practitioners
- Unsigned GST notices: The challenge concerning the alleged absence of signatures on Form GST DRC-01 was not decided on merits. The order should not be treated as a ruling that an unsigned notice is invalid.
- Delay in filing appeals: A taxpayer seeking to pursue an appeal after delay may request condonation, but acceptance of the request remains subject to the appellate authority’s consideration.
- Opportunity to raise grounds: The petitioner was permitted to raise all available grounds of law and fact in the statutory appeal.
- Procedural compliance: The Court specified a two-week period for filing the appeal, together with the statutory pre-deposit and delay-condonation application.
Conclusion
The decision in M/s. Sunny Enterprises highlights the importance of pursuing the statutory appellate remedy while properly addressing procedural delays. Although the petitioner raised substantial objections concerning the GST notice and the circumstances of the COVID-19 period, the High Court did not adjudicate those issues on merits.
FULL TEXT OF THE JUDGMENT/ORDER OF TELANGANA HIGH COURT
Mr. K.P.Amarnath, learned counsel appears for the petitioner.
Mr. Dominic Fernandes, learned Senior Standing Counsel appears for Central Board of Indirect Taxes and Customs (CBIC).
2. The writ petition has been preferred with the following prayer:
“For the reasons stated in the accompanying affidavit, it is prayed that the Hon’ble Court may be pleased to issue a Writ of Mandamus or any other appropriate writ or order or direction setting aside the impugned summary notice in Form GST DRC-01 vide Ref.No.DRC01_154009, dated 11.09.2023 as passed byst the 1 respondent under Section 73 of the Central Goods and Services Tax Act, 2017 and the Telangana Goods and Services Tax Act, 2017 without having anyst signatures as illegal, without jurisdiction and the consequent action of the 1 respondent in confirming the demand of tax and penalty in a sum of Rs.10,80,354/- vide the impugned Order-in-original, dated 26.12.2024 without considering he extraordinary and unprecedented circumstances as prevailing during the tax period 2020-21 due to COVID-19 pandemic, as being illegal, perverse and also unsustainable on merits and pass such other order or orders as the Hon’ble Court may deem fit and proper in the circumstances of the case.”
3. After arguing for sometime, learned counsel for the petitioner seeks liberty to the petitioner to prefer an appeal against the impugned Order-in- original. He submits that some delay might have been occurred in approaching the appellate authority and therefore, the appellate authority may be directed to consider the appeal sympathetically.
4. Learned Senior Standing Counsel for CBIC submits that the petitioner is at liberty to prefer an appeal against the impugned Order-in- original taking all the grounds as are available to it in law and on facts before the appellate authority in respect of the subject tax period.
5. However, upon hearing the learned counsel for the parties, since the petitioner seeks liberty to prefer an appeal, we do not wish to comment on the merits of the contentions raised by the parties.
6. Therefore, we grant liberty to the petitioner to prefer an appeal within a period of two weeks with statutory pre-deposit and a delay condonation application. The petitioner may take all such grounds of law and on facts in the memo of appeal as are available to it. Needless to say, the appellate authority would consider the question of delay taking into account the aforesaid facts and circumstances and if it is satisfied on the point of delay, proceed to decide the appeal on merits in accordance with law.
7. The Writ Petition is, accordingly, disposed of. There shall be no order as to costs.
Miscellaneous applications, if any pending, shall stand closed.
