August Attorneys LLP Vs Union of India & Ors. (Delhi High Court)
The Delhi High Court has held that the lack of proper communication of a GST cancellation order is a valid reason to condone a delay in filing an appeal. The ruling came in the case of August Attorneys LLP vs Union of India & Ors., where a law firm challenged an order from the Commissioner of Central Tax that dismissed its appeal on the grounds of limitation.
The petitioner, a law firm, claimed its GST registration was canceled without proper notice. Due to changes in the firm’s partnership structure, they were unable to file returns. According to the firm, a show-cause notice was issued in October 2022, but they never received it. This resulted in an ex-parte order in September 2023 that canceled their GST registration retroactively from October 2021. The firm only became aware of the cancellation later and filed an appeal, which was dismissed as being time-barred.
The Delhi High Court noted that the Appellate Authority’s dismissal of the appeal was based on Section 112 of the CGST Act, which deals with appeals to the Appellate Tribunal, not the Appellate Authority. The correct provision, Section 107, allows for a delay to be condoned if the appellant can show “sufficient cause.” The court also highlighted that the limitation period for an appeal starts from the date an order is “communicated” to the taxpayer. The court found that the lack of communication of the show-cause notice and the final cancellation order to the firm could be a valid reason for the delay.
