GST Appeal Time Limit: Can Delay Beyond 120 Days Be Condoned? A Legal Analysis

Green Filed Agrotech Vs State of West Bengal & Ors. (Calcutta High Court)

GST Appeal Delay: Calcutta HC Allows Condonation Beyond 120 Days

1. The petitioner, Green Field Agrotech, who were not satisfied with a tax order under Section 73(10) of the WBGST passed on December 5, 2023,

2. To challenge this order, the petitioner filed an appeal on May 15, 2024, after depositing 10% of the disputed tax amount.

3. However, this appeal was filed 42 days late beyond the prescribed time limit as mentioned in section 107(1) and 107(4)

4. Under Section 107(1), an appeal must be filed within three months from the date of order communicated to the assess, with an additional one-month extension u/s 107(4) may be allowed for delay, but not beyond that for the sufficient cause. So, in total maximum period under which one should file an appeal is shown below

Time allowed for appeal by default (Section 107(1)) → 90 days

Maximum condonation period (Section 107(4)) → 30 days

Total maximum period to file an appeal → 120 days

5. The GST appellate authority i.e. department rejected the appeal on June 26, 2024 by stating that they did not have the power to condone (excuse) a delay of more than one month beyond the prescribed limit mentioned in 107(4).

6. In the section 107(4), Appellate authority has been given power to condone the delay after 90 days by only one month, so they do not poses the power as per the Act and provision.

7. The petitioner then approached the Calcutta High Court, arguing that they had a legal right to appeal and also to request condonation of delay.

8. The respondent i.e. Department said that they have a strict time limit as per the provisions, and the appellate authority was correct in rejecting the appeal of the petitioner as per the section 107(1) and 107(4).

9. The court observed that even though the appeal was barred by limitation (Time Limit Has Expired), the petitioner had the right to apply for condonation of delay under Section 5 of the Limitation Act, 1963.

10. The Calcutta high court said and emphasized that in the nation best interest to resolve any lawsuit as quickly as possible and for this prescribed various period of time limit i.e. limitation beyond which, the right to approach any authority for redressal of the grievances remain suspended and closed.

11. The high court refers to Section 29(2) of the Limitation Act, 1963. This section deals with situations where a special law (GST Act, 2017) prescribes a different time limit than the general Limitation Act. The court said that in such cases, the provisions of the Limitation Act will still apply, unless the special law (GST Act, 2017) explicitly excludes them.

12. Here, in GST Act, 2017 and more specifically section 107 of the GST act, does not have any non-obstante clause (Notwithstanding- is a provision in a statute or contract that explicitly overrides or supersedes other laws, regulations, or provisions that may conflict with it.), if there would be any non-obstante clause then limitation act would have not attracted but, in the provision, this clause is not mentioned.

13. The court also examines the Section 107 and noticed that section 107 doesn’t explicitly (Clearly and directly mentioned or expressed) exclude the application of the Limitation Act, 1963. In fact, Section 108 of the GST Act given revisional authority with a longer time limit i.e. 3years then 120 days under section 107(1) & (4), suggesting that the GST act itself doesn’t intend to override the Limitation Act.

14. The Calcutta High Court referred to an earlier decision (S.K. Chakraborty & Sons vs. Union of India, 2023 SCC Online Calcutta 4759), which established that an appeal authority should consider condonation applications if valid reasons are provided.

15. Since the petitioner had explained the delay and the court found it reasonable, the High Court set aside (cancelled) the rejection order and restored the appeal.

16. The appellate authority was directed to hear the appeal on its merits within two months.

Key Takeaways from the Case:

1. Timely filing of appeals is very important and always file before the deadline: GST laws have strict deadlines and filing after the deadline can lead an appeal to rejection if no valid ground is provided by the assessee.

2. Condonation of delay is only possible in few cases: If a valid reason for the delay exists along with proper supporting and documents, courts may allow the appeal to proceed otherwise will get rejected, so its always beneficial to keep record of the proof before hand..

3. Earlier favourable judgements should be mentioned: The court relied on an earlier judgment to support its decision in Favor of the petitioner and it will be best if the favourable judgment is of the same court like in this case.

Conclusion:

This case highlights the importance of legal remedies in tax matters, even if an appeal is rejected by the department due to a procedural issue, courts can intervene and provide relief if a reasonable explanation is given. Business owners and tax professionals should be aware of their rights and deadlines when dealing with GST appeals.

Related Case:

1. Kamala Stores & Anr. Vs State of West Bengal & Ors. (Calcutta High Court) WPA 25280 of 2024 dated 06/02/2025 (This case is similar to above case and once can refer this case)

2. 020 Volume 5 Supreme Court Cases 757 (New India Assurance Company Ltd vs. Hilli Multipurpose Cold Storage Private Limited)

3. (2023) 97 GST 154 (Calcutta) (Kajal Dutta vs. Assistant Commissioner of State Tax, Suri Charge and Ors.)

4. 020 Volume 17 Supreme Court Cases 692 (Superintending Engineer/Dehar Power House Circle Bhakra Beas Management Board (PW) Slapper and Another vs. Excise and Taxation Officer Sunder Nagar/Assessing Authority)

Key Provisions for reference.

• Section 5 of the Limitation Act, 1963, states: – Extension of prescribed period in certain cases. — Any appeal or any application, other than an application under any of the provisions of Order XXI of the Code of Civil Procedure, 1908 (5 of 1908), may be admitted after the prescribed period if the appellant or the applicant satisfies the court that he had sufficient cause for not preferring the appeal or making the application within such period. Explanation. —The fact that the appellant or the applicant was misled by any order, practice or judgment of the High Court in ascertaining or computing the prescribed period may be sufficient cause within the meaning of this section.
• 29(2) of the Limitation Act, 1963, Where any special or local law prescribes for any suit, appeal or application a period of limitation different from the period prescribed by the Schedule, the provisions of section 3 shall apply as if such period were the period prescribed by the Schedule and for the purpose of determining any period of limitation prescribed for any suit, appeal or application by any special or local law, the provisions contained in sections 4 to 24 (inclusive) shall apply only in so far as, and to the extent to which, they are not expressly excluded by such special or local law.

FULL TEXT OF THE JUDGMENT/ORDER OF CALCUTTA HIGH COURT

Affidavit of service filed in Court today is taken on record.

The present writ petition has been filed, inter alia, questioning the purported rejection of the appeal under Section 107 of the West Bengal Goods and Service Tax Act, 2017 (hereinafter referred to as the said Act) vide form GST-APL 02 dated 26^th June, 2024.

Mr. Sharma, learned advocate representing the petitioner submits that being aggrieved by the order dated 5^th December, 2023 passed under Section 73(9) of the said Act, the petitioner had filed an appeal on 15^th May, 2024 as would appear from Form GST APL 01.

By drawing attention of this Court to page 6 of the writ petition it is submitted that the aforesaid appeal was filed along with 10% pre deposit of the disputed amount of tax. A system generated provisional acknowledgement form as proof of submission of appeal was also issued. Since, the said appeal was filed beyond the time prescribed the same was accompanied by an application for condonation of delay. According to the petitioner, there was a delay of 42 days in filing the appeal.

Subsequently, on 15^th May, 2024 the petitioner had received a notice as to why the appeal should not be rejected due to the delay as the same was filed beyond one month of the prescribed period as provided for under Section 107(1) read with Section 107(4) of the said Act.

Mr. Sharma by drawing attention of this Court to the order impugned submits that the Appellate Authority by ignoring the explanation given by the petitioner and by placing reliance on the proviso to sub­section (4) of Section 107 of the said Act had returned a clear finding that there is no power vested with the Appellate Authority to allow the appeal beyond one month after the time prescribed for filing the appeal. According to the petitioner, the petitioner has not only a statutory right to prefer an appeal but also has a right to seek condonation of delay in preferring an appeal. It would be apparent and clear from the above order that the Appellate Authority had failed to exercise jurisdiction vested in it while rejecting the appeal solely on the ground that it does not have the competence to condone the delay beyond one month of the time prescribed.

Mr. Siddiqui, learned advocate enters appearance on behalf of the respondents and opposes the petition. He, however, submits that since, the statute provides for the period for which delay can be condoned, there is no irregularity on the part of the Appellate Authority in refusing to condone the delay beyond the period of one month from the time prescribed.

Heard the learned advocates appearing for the respective parties and considered the materials on record. Admittedly in this case, it would appear that the appeal had been dismissed solely on the ground that the same had been filed beyond one month of the time prescribed for filing the appeal. The appeal therefore, was obviously barred by limitation. However, at the same time, the aforesaid could not prevent the petitioner from maintaining an application for condonation of delay by invoking the provisions of Section 5 of the Limitation Act, 1963. The issue whether the Appellate Authority is competent to condone the delay beyond one month from the prescribed period for filing of an appeal has already been conclusively decided by the Hon’ble Division Bench of this Court in the case of S. K. Chakraborty & Sons Vs. Union of India reported in 2023 SCC Online Calcutta 4759.

Having regard to the aforesaid I am of the view that the Appellate Authority ought to have taken note of the explanation given in the application for condonation of delay under Section 5 of the Limitation Act, 1963.

Having regard to the aforesaid, while setting aside the order of rejection of appeal dated 26^th June, 2024 as appearing in Form GST APL 02 and taking note of the fact that no fruitful purpose will be served by remanding the aforesaid matter on the issue of condonation of delay to the Appellate Authority and also considering the explanation given by the petitioner, I am of the view that the petitioner has been able to sufficiently explain the delay in filing the appeal belatedly. In view thereof, I restore the aforesaid appeal to its original file and number and direct the Appellate Authority to hear out the same in accordance with law on merit within a period of two months from the date of communication of this order.

Since no affidavit-in-opposition has been called for, the allegation made in the writ petition are deemed not to have been admitted by the respondents.

With the above observations and directions, the writ petition is disposed of.

Urgent Photostat certified copy of this order, if applied for, be made available to the parties upon compliance of requisite formalities