Dola Bharati vs. State Of West Bengal And Ors.

Held

The Court allowed the writ petition. The primary ground for allowing the petition was the Appellate Authority's rigid approach in dismissing the appeal solely on grounds of limitation, without adequately considering the petitioner's genuine extenuating circumstances, specifically her husband's critical illness, supported by medical documentation. The Court found this to be an unreasonable interpretation of statutory time limits and lacking in judicial empathy. Furthermore, the Court noted that the petitioner's right to further appeal was obstructed by the non-formation of the GST Appellate Tribunal. Citing the Division Bench judgment in S.K. Chakraborty & Sons Vs. Union of India, the Court held that Section 5 of the Limitation Act, 1963, is attracted to Section 107 of the WBGST Act, 2017, as there is no express or implied exclusion. This means the Appellate Authority has the discretion to condone delays beyond the prescribed period if sufficient cause is shown. The impugned orders were quashed, and the Appellate Authority was directed to consider and decide the petitioner's application for condonation of delay on merits. If the delay is condoned, the appeal is to be heard and disposed of on merit.

Facts

The petitioner, Dola Bharati, a sole proprietor, challenged orders passed by the Assistant Commissioner of State Tax and the Appellate Authority under the WBGST Act, 2017. An intimation dated May 15, 2023, alleged excess Input Tax Credit (ITC) of ₹5,65,883.26 for the tax periods 2017-2018. A Show Cause Notice was issued on May 28, 2023, without a personal hearing. The Assistant Commissioner passed an order on July 27, 2023, confirming a demand of ₹5,75,772.35, including penalties and interest. The petitioner filed an appeal under Section 107 of the WBGST Act, 2017, with a delay condonation application, citing her husband's critical illness. The Appellate Authority rejected the appeal on grounds of limitation by an order dated May 24, 2023, prompting the present writ petition.

Key Issues

1. Whether the order passed by the adjudicating authority on July 27, 2023, is legally sustainable, given the alleged violation of the principles of natural justice by not providing a personal hearing as mandated by Section 75(4) of the CGST/WBGST Act, 2017, and whether the adjudication was arbitrary and lacked proper verification of returns. 2. Whether the adjudicating authority erred in proceeding with the adjudication and issuing the order despite the petitioner having reversed the erroneously availed ITC and whether the order exceeded the statutory time limit prescribed by Section 73(10) of the CGST Act, 2017. 3. Whether the Appellate Authority erred in rejecting the petitioner's appeal on grounds of limitation, despite the delay being attributable to unavoidable personal circumstances (husband's critical illness) supported by medical documentation, and whether the non-formation of the GST Appellate Tribunal obstructs the petitioner's constitutional rights. Petitioner's Arguments: - Violation of principles of natural justice (no personal hearing). - Arbitrary and biased adjudication, failure to verify returns. - Overlooking ITC reversal and exceeding statutory time limits. - Unreasonable rejection of appeal for delay due to extenuating circumstances. - Obstruction of statutory appeal rights due to non-formation of GST Appellate Tribunal. Respondent's Arguments: - The appeal was filed beyond the prescribed period under Section 107(1) and 107(4) of the WBGST Act, 2017, exceeding the maximum allowable four months.