Case Law Details
Thar Solar Irrigation Vs State of Rajasthan (Rajasthan High Court)
The petitioner sought a direction to condone a delay of 216 days in filing an appeal against an Order-in-Original dated 21 April 2025 cancelling the petitioner’s GST registration. The appeal was filed on 13 March 2026 but was dismissed by the Appellate Authority on 27 March 2026 on the ground that it lacked power to condone the delay beyond the statutory period prescribed under Section 107 of the RGST Act.
The petitioner submitted that the delay occurred due to unavoidable and bona fide circumstances beyond its control, including prolonged illness and acute financial difficulties. According to the petitioner, these circumstances prevented proper management of business affairs and delayed filing of the appeal. It was argued that the delay was neither intentional nor due to negligence.
The petitioner relied on several Division Bench judgments of the Rajasthan High Court, including M/s Molana Construction Company v. Central Goods and Service Tax Department, Man Singh Tanwar v. Commissioner, Central Goods and Services Tax Department, and RPC PSIPL JV v. State of Rajasthan, contending that where sufficient cause is shown, the Court can direct consideration of the appeal on merits after condoning the delay.
The respondents opposed the petition, arguing that the appellate proceedings were barred by limitation and that the assessment order had been rightly passed.
The Rajasthan High Court observed that although the Appellate Authority is bound by the limitation provisions under Section 107 of the RGST Act, refusal to adjudicate the appeal on merits in the present circumstances would cause grave injury and prejudice to the petitioner. The Court noted that earlier decisions of the High Court had permitted entertaining delayed appeals in similar situations.
The Court also referred to its earlier judgment in M/s M R Traders v. Union of India, which held that while constitutional courts exercising jurisdiction under Article 226 may condone delay to prevent denial of remedy, the Appellate Authority itself has no unrestricted discretion to condone delay beyond the limit prescribed under Section 107(4). The judgment further observed that the GST framework is intended not only for revenue collection but also to facilitate trade and business continuity. Cancellation of GST registration and denial of appellate remedies could impair livelihood and business operations.
Following the consistent view taken in earlier cases, the Court condoned the delay of 216 days after granting the statutory relaxation of 120 days under Section 107 of the CGST Act. The impugned appellate order dated 27 March 2026 was set aside, and the Appellate Authority was directed to entertain and decide the appeal on merits.
FULL TEXT OF THE JUDGMENT/ORDER OF RAJASTHAN HIGH COURT
1. The petitioner herein, inter alia, seeks a direction commanding respondent No.3 to condone the delay of 216 days in filing the appeal against the Order-in-Original dated 21.04.2025 (Annexure-3), passed by the Assistant Commissioner, Jodhpur, whereby order for cancellation of GST registration issued against the petitioner. The appeal against the said order was filed on 13.03.2026. However, the Appellate Authority vide order dated 27.03.2026 dismissed the appeal on the ground of limitation as it does not have the power to condone the delay in filing the appeal.
2. Learned counsel for the petitioner submits that the delay in filing the appeal occurred due to unavoidable and bona fide circumstances beyond the control of the petitioner. It is submitted that owing to prolonged illness coupled with acute paucity of funds, the appellant was unable to properly concentrate on and manage his business affairs, which consequently led to the delay in preferring the appeal within the prescribed period of limitation. The delay is thus occasioned by genuine and sufficient cause, and not due to any negligence or lack of diligence on the part of the petitioner.
3. Owing to these circumstances, the petitioner could not take necessary steps within the prescribed period. The delay was neither intentional nor due to any negligence, but was caused solely by the genuine difficulties faced during the said period. 3. In the aforesaid backdrop, we have heard the learned counsels for the parties and perused the record.
4. Learned Counsel for the petitioner, relying on the various Division Bench judgments of this very Court in M/s Molana Construction Company v. Central Goods and Service Tax Department & Ors1 , Man Singh Tanwar v. Commissioner, Central goods and Services Tax Department & Ors.2 , RPC PSIPL JV Vs. State of Rajasthan & Ors3 and RPC PSIPL JV Vs. State of Rajasthan & Ors4 argues that sufficient cause of delay in filing the appeal due to circumstances beyond control has been shown and thus appeal be directed to be considered on merits after condoning the delay by this Court.
5. Learned counsel for the respondents opposes the above submission and contends that the assessment order has rightly been passed, appeal is now barred by limitation.
6. Having heard, as above, it transpires that while it is true that the Appellate Authority is bound by the statutory provisions of limitation provided under Section 107 of the RGST Act, however, considering the reasons owing to which the petitioner could not file its appeal within the stipulated time, being beyond its control, non- adjudication of appeal on merits would cause grave injury and prejudice to the petitioner.
7. In the judgments cited above in para 4 of preceding part of instant order, this Court, while allowing the writ petitions, issued directions to entertain the appeal on merits.
8. In the context of present case, where cancellation of GST registration results in loss of livelihood, reference may also be had to another judgment of this Court in M/s M R Traders v. UOI5 . For ready reference, relevant portion thereof is reproduced hereinbelow:-
1.5. The distinction, therefore, is not one of sympathy or sufficiency of cause, but of jurisdictional competence. While constitutional courts, exercising plenary powers under Article 226 of the Constitution of India, may in appropriate cases condone delay so as to prevent a complete denial of remedy, such constitutional elasticity cannot be transposed into the statutory framework governing the Appellate Authority.
11.6. Thus, we are of the opinion that the statutory scheme under Section 107 admits of no discretion with the appellate authority to grant extension beyond the expressly prescribed period. The application of the Limitation Act stands unequivocally excluded by necessary implication. Accordingly, we hold that the Appellate Authority does not possesses the unrestricted discretion under Section 5 of the Limitation Act to condone delay beyond the ceiling prescribed in Section 107(4).
12. It is also pertinent to note that the CGST Act is not a statute enacted solely for revenue collection. It represents a comprehensive fiscal reform intended to consolidate multiple indirect taxes and, at the same time, to facilitate trade, commerce, and business continuity. This legislative intent is clearly discernible from the scheme of the Act, particularly the provisions relating to revocation of cancellation of registration under Section 30 and appellate remedies under Section 107. The emphasis of the statute is thus not merely punitive compliance, but regulated facilitation of economic activity. Any interpretation which renders statutory remedies illusory on hyper-technical grounds would defeat the very purpose of the enactment.
13. Cancellation of GST registration or missed appellate deadlines should not permanently debar a taxpayer from the GST framework, especially where the taxpayer intends to comply by filing returns, paying taxes, interest, and penalties, and rectifying defaults. In such cases, denial of opportunity to an assessee undermines the inclusive and facilitative objective of the GST regime. Non-restoration of GST registration in such cases also directly impairs the assessee’s ability to conduct business, earn a livelihood and leads economic paralysis, thus, violating Articles 14 and 21 of the Constitution by imposing disproportionate and unreasonable hardship.”
9. In the premise, following the consistent view as already taken by this Court, ibid, we allow the present writ petition to the extent of condoning the delay of 216 days (after granting relaxation of 120 days under Section 107 of CGST Act) in filing of the appeal by the petitioner.
10. Accordingly, the impugned appellate order dated 27.03.2026 is set aside. Delay of 216 days in filing of the appeal is condoned. The Appellate Authority is directed to entertain the appeal of the petitioner and adjudicate the appeal on merits.
11. Stay petition and all pending application stands disposed of.
Notes:
1 2024 SCC OnLine Raj 3938
2 D.B. CWP 14658/2024
3 D.B. CWP 7260/2025
4 D.B. CWP 11794/2025
5 2026 SCC OnLine RAJ 2115
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