Introduction: Navigating the complexities of GST appeals can be challenging, especially when time constraints come into play. This article explores a crucial aspect—how Section 14 of the Limitation Act, 1963, can provide significant relief to GST taxpayers facing dismissal on the grounds of exceeding the stipulated time frame.
It is submitted that at present Appellate Authority is dismissing the appeal filed by the taxpayer under GST on the ground that the same was time barred being filed beyond the period of four months as prescribed under Section 107 of the CGST Act, 2017/SGST Act, 2017. One case of filing the delayed appeal was that appeal has been filed in wrong jurisdiction and taxpayer has accordingly, withdrew the same and filed a fresh appeal before correct jurisdiction.
The Hon’ble High Court of Allahabad in the matter of Murli Packers Through Its Proprietor Rakesh Kumar Jain vs. State of U P Through Secretary, Institutional Finance and 2 Others (Writ Petition No. 407 of 2020 and Judgment Dated 24.01.2024) has granted the benefit of Section 14 of the Limitation Act to the petitioner.
The provision of Section 14 in The Limitation Act, 1963 which reads as follows
(1) In computing the period of limitation for any suit the time during which the plaintiff has been prosecuting with due diligence another civil proceeding, whether in a court of first instance or of appeal or revision, against the defendant shall be excluded, where the proceeding relates to the same matter in issue and is prosecuted in good faith in a court which, from defect of jurisdiction or other cause of a like nature, is unable to entertain it.
(2) In computing the period of limitation for any application, the time during which the applicant has been prosecuting with due diligence another civil proceeding, whether in a court of first instance or of appeal or revision, against the same party for the same relief shall be excluded, where such proceeding is prosecuted in good faith in a court which, from defect of jurisdiction or other cause of a like nature, is unable to entertain it.
(3) Notwithstanding anything contained in rule 2 of Order XXXIII of the Code of Civil Procedure, 1908 (5 of 1908), the provisions of sub-section (1) shall apply in relation to a fresh suit instituted on permission granted by the court under rule 1 of that Order where such permission is granted on the ground that the first suit must fail by reason of a defect in the jurisdiction of the court or other cause of a like nature.
Explanation.—For the purposes of this section,—
(a) in excluding the time during which a former civil proceeding was pending, the day on which that proceeding was instituted and the day on which it ended shall both be counted;
(b) a plaintiff or an applicant resisting an appeal shall be deemed to be prosecuting a proceeding;
(c) misjoinder of parties or of causes of action shall be deemed to be a cause of a like nature with defect of jurisdiction.
An Analysis of Section 14 of Limitation Act, 1963
1. Exclusion of Time During the Prosecution of Another Proceeding:
- Scope: Section 14(1) applies when a plaintiff is actively pursuing another civil proceeding against the same defendant, relating to the same matter in issue, in a court of first instance, or in appeal or revision.
- Conditions for Exclusion:
- The plaintiff must be diligent in prosecuting the other proceeding.
- The other proceeding should be in good faith.
- The court where the other proceeding is filed must be unable to entertain it due to jurisdictional defects or similar reasons.
- Calculation: The time during which the other proceeding is pending is excluded from the computation of the limitation period.
2. Exclusion of Time During the Prosecution of Another Proceeding for the Same Relief:
- Scope: Section 14(2) comes into play when an applicant is diligently pursuing another civil proceeding against the same party for the same relief, whether in a court of first instance, or in appeal or revision.
- Conditions for Exclusion:
- The applicant must be diligent in prosecuting the other proceeding.
- The other proceeding should be in good faith.
- The court where the other proceeding is filed must be unable to entertain it due to jurisdictional defects or similar reasons.
- Calculation: The time during which the other proceeding is pending is excluded from the computation of the limitation period for the application.
3. Application in Fresh Suits with Court’s Permission:
- Scope: Section 14(3) applies to a fresh suit instituted with the court’s permission under Order XXXIII of the Code of Civil Procedure. The permission is granted on the ground that the first suit would fail due to a defect in the court’s jurisdiction or a similar cause.
- Calculation: The time spent in pursuing the initial suit is excluded when calculating the limitation period for the fresh suit.
4. Explanation:
- Calculation of Time: The time during which a former civil proceeding was pending is calculated by including both the day of institution and the day of its conclusion.
- Deemed Prosecution: Plaintiffs or applicants resisting an appeal are deemed to be prosecuting a proceeding.
- Misjoinder of Parties or Causes of Action: Misjoinder is deemed a cause of a like nature with a defect of jurisdiction.
Conclusion: Understanding the nuances of Section 14 is crucial for GST taxpayers seeking an appeal beyond the prescribed time limit. The recent judgment by the Allahabad High Court sets a precedent for the application of this provision in GST cases. Taxpayers must be aware of their rights under Section 14 and explore its benefits in situations where jurisdictional errors or similar issues impact the appeal process.
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Disclaimer: Nothing contained in this document is to be construed as a legal opinion or view of either of the author whatsoever and the content is to be used strictly for informational and educational purposes. While due care has been taken in preparing this article, certain mistakes and omissions may creep in. the author does not accept any liability for any loss or damage of any kind arising out of any inaccurate or incomplete information in this document nor for any actions taken in reliance thereon.
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