Acme Paints And Resin PVT. LTD. vs. Deputy Comms. Of Revenue, State Tax, Esplanade And Fairlie Place Charge And Ors.
Original PDF →Facts
The petitioner, Acme Paints and Resin Private Limited, filed a writ petition challenging an order dated 15th March, 2024, passed by the appellate authority under Section 107 of the CGST/WBGST Act, 2017. This order rejected the petitioner's appeal against an order dated 14th August, 2023, passed under Section 73(9) of the said Act. The petitioner had made a pre-deposit of Rs. 1,76,141/- as required for the appeal. However, the appeal was filed beyond the prescribed time limit under Section 107(4) of the Act, and the petitioner could not adequately explain the delay.
Held
The Court held that while the explanation for the delay, being an oversight by the accountant, was not entirely adequate, the petitioner had demonstrated a lack of mala fide by making the pre-deposit of Rs. 1,76,141/-. Considering the end of justice and the possibility of merits in the appeal, the Court decided to set aside the appellate authority's order dated 15th March, 2024. The Court's reasoning was that a technical rejection on limitation grounds, when a substantial pre-deposit has been made and there's a claim of bona fide oversight, might not serve the interests of justice. The ratio is that High Courts may intervene to allow appeals to be heard on merits, even if delayed, upon payment of costs, especially when pre-deposits are made, to avoid penalizing potential substantive claims due to procedural lapses.
Key Issues
1. Whether the appellate authority erred in rejecting the petitioner's appeal on the grounds of limitation, despite the petitioner having made the pre-deposit amount and claiming a bona fide oversight by its accountant (turning on Section 107(4) and Section 107(6) of the CGST/WBGST Act, 2017). Petitioner's arguments: The petitioner contended that it was prevented from filing the appeal within the prescribed time due to its accountant overlooking the order on the portal. The petitioner argued that it has strong grounds for appeal and a fair chance of success, and the appeal should not be rejected on technical grounds. The petitioner relied on the fact that the pre-deposit was made, indicating bona fide intent. Revenue's arguments: The respondents argued that the appeal was filed belatedly, and there was no proper explanation for the condonation of delay. They contended that the appellate authority acted correctly in rejecting the appeal on the ground of limitation.
Sections Cited
Section 107, Section 73, Section 107(4), Section 107(6)
AI-generated summary — verify with the full judgment below
M/L 23 04.07.2024 sb Ct 5
IN THE HIGH COURT AT CALCUTTA CONSTITUTIONAL WRIT JURI ICTION APPELLATE SIDE
WPA 12250 of 2024
Acme Paints and Resin Private Limited Versus The Deputy Commissioner of Revenue, State Tax & Ors.
Mr. Debanuj Basu Thakur
… For the petitioner.
Mr. Anirban Ray, Ld GP,
Mr. T. M. Siddiqui
Mr. Tanoy Chakraborty
Mr. Debraj Sahu
… For the respondents.
The present writ petition has been filed, inter alia, challenging the order dated 15th March, 2024, passed by the appellate authority under Section 107 of the CGST/WBGST Act, 2017 (hereinafter referred to as the “said Act”)
It is the petitioner’s case that being aggrieved by the order dated 14th August, 2023, passed under Section 73(9) of the said Act, the petitioner had filed an appeal before the appellate authority. Simultaneously, with the filing of the appeal, the petitioner had also made pre-deposit of Rs.1,76,141/-in terms of provisions of Section 107(6) of the said Act, as is required for maintaining the appeal. The said appeal was, however, filed
2 beyond the time prescribed for filing of an appeal as provided for under Section 107(4) of the said Act. It appears that the petitioner could not appropriately explain the delay in filing the appeal. It is on such ground, the appeal had been rejected.
Mr. Basu Thakur, learned advocate representing the petitioner submits that the petitioner had been prevented from preferring the appeal within the time prescribed. It is contended that the petitioner’s accountant who deals with all tax matters had overlooked the aforesaid order on the portal. It is submitted that the petitioner has good grounds for preferring the appeal and has a fair chance of success. The aforesaid appeal should not be rejected on technical grounds.
Mr. Siddiqui, learned advocate representing the respondents submits that the appeal was filed belatedly. There is no proper explanation for condonation of delay. In the facts as noted hereinabove, there is no irregularity on the part of the appellate authority in rejecting the appeal on the ground of limitation.
Heard the learned advocates appearing for the respective parties and considered the materials on record. It appears that being aggrieved by the order
3 dated 14th August, 2023, passed under Section 73(9) of the said Act an appeal had been filed. Simultaneously, with the filing of the appeal, the petitioner had also made a pre-deposit of Rs.1,76,141/-. As such, from the above, it cannot be said that there is any lack of bona fide on the part of the petitioner. The petitioner claims that by reasons of oversight on the part of its accountant,
the appeal could not be filed on time. The aforesaid explanation though, does not appear to be adequate, however, for the end of justice and taking into consideration of the fact that the petitioner may have merits in the appeal and the petitioner having deposited the pre-deposit amount, I propose to and do hereby set aside the order dated 15th March, 2024, subject to the petitioner’s making payment of cost of Rs.25,000/- with the concerned GST authorities.
If the petitioner makes the aforesaid payment within a period of two weeks from date and files an application praying for condonation of delay, before the appellate authority disclosing the receipt of payment costs, the appellate authority shall condone the delay and hear out the appeal on merits upon giving an opportunity of hearing to the petitioner. It is made clear that the aforesaid direction is
4 peremptory.
In the event, the petitioner fails to comply with the direction indicated hereinabove, the petitioner shall not be entitled to the benefit of this order and the writ petition shall stand automatically dismissed without any further reference to the petitioner.
With the above observations and directions, the writ petition is disposed of.
There shall be no order as to costs.
Urgent Photostat certified copy of this order, if applied for, be made available to the parties upon compliance of requisite formalities.
(Raja Basu Chowdhury, J.)
Reproduced from the public record of the Calcutta High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.