Case Law Details
Pramod Kumar Mehta Vs Union of India (Patna High Court)
The Patna High Court recently ruled on the case of Pramod Kumar Mehta Vs Union of India, addressing a delayed appeal under the Bihar Goods and Services Tax (BGST) Act. The petitioner, Pramod Kumar Mehta, had filed an appeal that was dismissed for being beyond the allowed period for filing appeals under Section 107 of the BGST Act.
Background of the Case
Section 107 of the BGST Act stipulates that an appeal against an order of a Proper Officer can be filed within three months from the date of the order. If this period is missed, an additional one-month extension can be granted if a satisfactory explanation for the delay is provided. However, in this case, the appeal was filed after the one-month extension had already passed, which led to its rejection by the first Appellate Authority.
The petitioner’s appeal was rejected on 18th May 2023, as it was deemed to be filed beyond the statutory period allowed by the law. The petitioner, challenging this rejection, approached the Patna High Court seeking relief, citing the special provisions under Notification No. 53 of 2023 issued by the Central Board of Indirect Taxes and Customs.
Key Developments in the Case
The notification, issued on 2nd November 2023, provided a special extension for filing appeals against orders passed under Sections 73 and 74 of the BGST Act for orders made on or before 31st March 2023. The notification allowed appeals to be filed by 31st January 2024, subject to certain conditions, including the payment of a part of the disputed tax amount.
As per the notification, an appellant needs to pay:
- The full amount of admitted tax, interest, fine, fee, and penalty.
- A further sum equal to 12.5% of the remaining disputed tax amount, subject to a maximum of ₹25 crore, with at least 20% to be paid through the Electronic Cash Ledger.
Additionally, the notification specifies that no refund shall be granted for any amount paid under this provision until the appeal is decided.
Court’s Ruling
After reviewing the case, the Patna High Court considered the provisions of the notification and noted that it allowed for the restoration of the appeal subject to certain conditions. The Court stated that the appeal filed by Pramod Kumar Mehta should be restored, provided that the petitioner fulfills the payment conditions outlined in the notification before the deadline of 31st January 2024.
The conditions for restoration include the payment of the deficient tax, interest, fine, fee, and penalty amounts as required by the notification. Specifically, the petitioner must remit the required portion of the disputed amount to maintain the appeal. The Court emphasized that the appeal would only be considered on its merits after these conditions are fulfilled.
Conditions for Restoration
The Court clarified that:
- The appeal filed must satisfy the payment conditions as per Notification No. 53 of 2023.
- The payment must be made by 31st January 2024, the extended deadline set by the notification.
- If the conditions are not met by the petitioner, the original order rejecting the appeal will stand.
This decision provides a window for the petitioner to restore the appeal if the required payments are made on time, and the appeal will be heard on its merits thereafter.
Conclusion
The Patna High Court allowed the writ petition, setting aside the dismissal of the appeal filed by Pramod Kumar Mehta. The Court gave the petitioner a final opportunity to satisfy the payment conditions as prescribed in the recent notification. If the conditions are met by 31st January 2024, the appeal will be considered and examined on its merits. However, failure to meet these conditions will result in the restoration of the initial dismissal order.
FULL TEXT OF THE JUDGMENT/ORDER OF PATNA HIGH COURT
The petitioner is before this Court since he filed a delayed appeal which is said to have been rejected by Annexure-P/6 for reason of the appeal having not been filed within the period of limitation. Section 107 of the BGST Act provides for three months time to file an appeal and a further time of one month in which an appeal could be filed with satisfactory explanation, for the delay occasioned.
2. The appeal filed in the above case, rejected by Annexure-P/6 was beyond even the one month period provided under Section 107 of the BGST Act. This Court and the Hon’ble Supreme Court have held that when there is a specific period provided in the statute, within which period a delayed appeal could be filed; then neither the Appellate Authority nor this Court under Article 226 of the Constitution of India could condone the delay beyond the period provided.
3. The Central Board of Indirect Taxes and Customs has by Notification No. 53 of 2023- Central Tax, dated 02.11.2023 (S.O. 4767(E)) extended the time for filing appeal against an order passed by the Proper Officer on or before 31.03.2023 under Sections 73 and 74 of the BGST Act. This in fact extends the period for filing a delayed appeal beyond the one month period as provided under Section 107(4) of the BGST Act, on following the special procedure prescribed under the said Notification.
4. The special procedure prescribed under the Notification is seen from paragraph no. 2 to 6 which are extracted hereunder:-
2. The said person shall file an appeal against the said order in FORM GST APL-01 in accordance with sub-section (1) of Section 107 of the said Act, on or before 31st day of January 2024:
Provided that an appeal against the said order filed in accordance with the provisions of section 107 of the said Act, and pending before the Appellate Authority before the issuance of this notification, shall be deemed to have been filed in accordance with this notification, if it fulfills the condition specified at para 3 below.
3. No appeal shall be filed under this notification, unless the appellant has paid-
a. in full, such part of the amount of tax, interest, fine, fee and penalty arising from the impugned order, as is admitted by him; and
b. a sum equal to twelve and a half per cent of the remaining amount of tax in dispute arising from the said order, subject to a maximum of twenty-five crore rupees, in relation to which the appeal has been filed, out of which at least twenty percent should have been paid by debiting from the Electronic Cash Ledger.
4. No refund shall be granted on account of this notification till the disposal of the appeal, in respect of any amount paid by the appellant, either on their own or on the directions of any authority (or) court, in excess of the amount specified in para 3 of this notification before the issuance of this notification, for filing an appeal under sub- section (1) of Section 107 of the said Act.
5. No appeal under this notification shall be admissible in respect of a demand not involving tax.
6. The provisions of Chapter XIII of the Central Goods and Service Tax Rules, 2017 (12 of 2017), shall mutatis mutandis, apply to an appeal filed under this notification.
5. Hence an appeal against an order under Section 73 or 74 has to be filed on or before 31.01.2024, and any appeal filed which is pending before the authority could also be considered as properly filed, even if there is delay in such filing.
6. However, the maintainability of the appeal is further regulated by paragraph no. 3 which require that the admitted tax, interest, fine, fee and penalty arising from the impugned order is paid up along with a sum equal to 12.5% of the remaining amount of tax in dispute arising from the said order subject to a maximum of twenty-five crore rupees; out of which 12.5%, 20% should have been paid by debiting from the Electronic Cash Ledger. The further conditions in paragraph no. 4 to 6 also shall be applicable.
7. In the present case, the appeal was filed and was dismissed by the first Appellate Authority. In such circumstances, it is only proper that the appeal be restored to the files of the Authority subject to the conditions under paragraph no. 3 being satisfied.
8. Hence the petitioner would be entitled to satisfy paragraph no. 3 of the aforesaid Notification by paying up the deficient amounts as would be required to maintain the appeal under the notification.
9. We specifically say the deficient amount, since on filing the appeal 10% of the amount of tax in dispute arising from the order impugned would/ought to have been remitted.
10. We set aside the impugned order dated 18.05.2023 at Annexure-P/6 on condition of the assessee satisfying the aforesaid conditions before the time stipulated in Notification; i.e. 31.01.2024, in which event, the appeal would be taken up and considered on merits. And if the conditions are not satisfied, then necessarily the impugned order would stand restored.
11. We allow the writ petition on the above terms.
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