Case Law Details
Nilamadhaba Enterprises Vs CT & GST Officer (Orissa High Court)
The case of Nilamadhaba Enterprises Vs CT & GST Officer saw the Orissa High Court take an unusual step due to the absence of a functional GST Appellate Tribunal. Faced with an appeal challenging an appellate order issued by the Joint Commissioner of State Tax, the High Court decided to put a stay on the tax demand, granting interim relief to the petitioner.
Analysis: This case revolves around an unmet tax and penalty demand made on the petitioner, Nilamadhaba Enterprises. The first appellate authority rejected the appeal preferred by the petitioner on the grounds that it contravened subsections (1) & (4) of Section 107 of the GST Act. The absence of a constituted second appellate tribunal complicated matters, as the petitioner could not appeal against the first appellate order.
The court weighed the arguments of both sides, with the petitioner arguing they were not liable to pay the demanded tax and penalty. The Department, represented by learned Standing Counsel Sunil Mishra, insisted that the delay in filing the appeal could not be condoned and the petitioner should pay the remaining disputed tax if they wish to appeal before the second appellate tribunal.
Conclusion: In this unusual case, the Orissa High Court decided to grant interim relief to the petitioner due to the absence of the second appellate tribunal. The High Court’s decision to stay the tax demand underscores the significance of having a fully constituted and operational legal apparatus to ensure that all parties can exercise their right to appeal effectively. The case of Nilamadhaba Enterprises Vs CT & GST Officer is a notable example of how the court can employ its discretion to provide interim relief in exceptional circumstances.
FULL TEXT OF THE JUDGMENT/ORDER OF ORISSA HIGH COURT
This matter is taken up through hybrid mode.
2. The present writ petition is being entertained only because the Second Appellate Tribunal has not yet been constituted.
3. The petitioner has filed this writ petition challenging the 1st appellate order dated 22.03.2023 passed by the Joint Commissioner of State Tax (Appeal), Jajpur Range, Jajpur by which said authority has not admitted the appeal preferred by the petitioner, as the same is in contravention to sub-sections (1) & (4) of Section 107 of the GST Act and has rejected the appeal filed under sub-Section (1) of Section 107 of the Odisha Goods and Services Tax Act, 2017.
4. Mr. S.P. Dalai, learned counsel for the petitioner contended that the petitioner is not liable to pay the tax and penalty and, as such, against the order passed by the 1st appellate authority though second appeal lies, the 2nd appellate tribunal has not yet been constituted. It is contended that the petitioner has already deposited 10% of the demanded tax amount before the first appellate authority and as there is no second appellate forum, this Court should entertain this writ petition.
5. Sunil Mishra, learned Standing Counsel vehemently contended that since there is delay in preferring the appeal, this Court may not be in a position to condone the delay beyond four months, particularly when appellate authority has not been vested with discretion to condone the delay beyond one month after lapse of three months from the date of communication of order impugned therewith. It is further contended that this case stands in different footing and, as such, the petitioner is liable to pay the tax. In the event the petitioner wants to avail the remedy by preferring appeal before the 2nd appellate tribunal then the petitioner is liable to pay 20% balance disputed tax for consideration of its appeal by the 2nd appellate tribunal.
6. Issue notice to the opposite parties.
7. Since Mr. Sunil Mishra, learned Standing counsel for the Department accepts notice for the Opposite parties, let required number of copies of the writ petition be served on him within three working days. Reply be filed within two weeks and rejoinder thereto, if any, be filed before the next date.
8. Since the petitioner wants to avail the remedy under the provisions of law by approaching 2nd appellate tribunal, which has not yet been constituted, as an interim measure subject to the Petitioner depositing entire tax demand within a period of fifteen days from today, the rest of the demand shall remain stayed during the pendency of the writ petition.
9. A. stands disposed of.
10. List this matter along with W.P.(C) No.6684 of 2023 on the date fixed therein.
