M/S.Joy Innovation vs. The Additional Commissioner
Original PDF →Facts
The petitioner, M/s. Joy Innovation, a registered partnership firm, had its GST registration cancelled by the Superintendent of Central Tax (Respondent No. 2) on December 11, 2019, due to non-filing of GST returns. The petitioner had responded to a show-cause notice on December 4, 2019, but the reply was deemed unsatisfactory. Aggrieved, the petitioner filed an appeal with the Additional Commissioner (Appeals-1) (Respondent No. 1). However, Respondent No. 1 dismissed the appeal on April 19, 2022, on the grounds that it was filed beyond the extended period of limitation. The petitioner then filed a writ petition before the High Court challenging these orders, noting that the GST appellate tribunal had not yet been constituted.
Held
The Court held that while the first appellate authority might have been technically correct in observing that the appeal was filed beyond the extended period of limitation, such a strict stance could adversely affect the petitioner, particularly since the GST Tribunal had not been constituted. The Court noted that the issue pertained to the cancellation of GST registration, which is vital for the petitioner's business. Citing its own previous decision in M/s. Chenna Krishnama Charyulu Karampudi v. Additional Commissioner (Appeals-1), which was followed in subsequent cases, the Court decided to remand the matter back to the primary authority (Respondent No. 2). The Court set aside the orders of both Respondent No. 2 and Respondent No. 1. Respondent No. 2 was directed to reconsider the petitioner's case and pass an appropriate order after affording a reasonable opportunity of hearing. The petitioner would be permitted to submit all pending returns as per the statute during the remand proceedings. The Court explicitly stated that it had not expressed any opinion on the merits of the case.
Key Issues
1. Whether the first appellate authority (Respondent No. 1) erred in dismissing the petitioner's appeal solely on the ground of limitation, thereby denying the petitioner an opportunity to have the merits of the GST registration cancellation considered? 2. Whether the High Court, in the absence of a constituted GST appellate tribunal, should remand the matter to the primary authority for reconsideration, given the circumstances? Petitioner's arguments: The petitioner contended that the dismissal of their appeal by the first appellate authority on technical grounds of limitation was arbitrary and illegal, especially as the GST Tribunal was not yet constituted, leaving them without a remedy. They argued that the cancellation of their GST registration, which is crucial for their business, should be considered on merits. Respondents' arguments: The judgment does not record specific arguments made by the respondents. However, their actions, as reflected in the orders being challenged, indicate a stance based on the petitioner's failure to comply with procedural requirements, specifically the timely filing of appeals.
Sections Cited
Section 107, Section 109, Section 112
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Cause title — parties, addresses and appearances
The Court made the following: ORDER
-- 1'IIE IION'B TFIE It TICE AI BH AND TI.I BLE S EN KARANT W.P.No.4196 of 2023 IUDGMENT, /i\r rlr I lot'br. th( Lt,it lultt,c I)iitlBttnar) Fleard Mr. Venkatram Reddy, leamed counsel for the petitioner and N,{s. Sapna Reddy, Ieamed counsel for the respondents.
This petition has been filed r.rnder Article 226 of the C-onstitution of India assailing the legality and validity of the order dated tI-12.2019 passed by respondent No.2 cancelling the Goods and Service Tax (GST) registration of the petitioner as well as the order-in-appeal dated 19.04.2022 passed by respondent No.1 dismissing the appeal filed by the petitioner against the order of respondent No.2 dated 11.12.2019. 3. Petitioner before us is a registered partnership firm engaged in the business of small creadve art works, set works rL. After coming into force of the GST enactments, peririoner got l i itself registered with the GST authoriry. In this connecrion,
-II ) registration cenificate was issued to the petitioner bearing rcgistration No.36AAKFIA22AL' l'ZU.
Slrow cause notice dateC 25.n.2AD was issued by respondent No.2 to the petitioner calling upon the petitioner to show cause as to why its GST registration should not be cancelled on account of non-liling ol GST r-eturns. In response to such show cause notice, petitioner submitted reply on 04.L2.2019 However, reply filed by the petitioner was found to be not satisfactory wherealter r-espondent No.2 passed the order dated 11.12.2019 cancelling the GST registration of the petitioner. However, it was clarified that such cancellation of registration would not effect the existing liability of the Petltroner.
Aggrieved by the aforesaid order dated 1.1.12.2019, petitioner preferred appeal before respondent No.1 under Section 107 of the Crntral Goods and Services Tax Act, 20L7. On the ground that the appeal was filed beyond the extended period of limitation, respondent No.1 declined to admit the I
appeal; rathcr he dismissed the same vide the order dated 19.04.2022. provided under Section 112 of the C-entral Goods and Services Tax Act, 2017, we have been informed that such an appellate Tribunal has not been constituted in the State of Telangana. Therefore, the present writ petition has been filed.
Issue raised in this writ petition is no longer re.r inreqru. \n M/s. Chenna Krishnama Charyulu Karampudi v Additional Commissioner (Appeals-1)1, which has been followed in subsequent decisions, this Court had remanded the mamer back to the file of the primary authority to reconsider and pass appropriate order after giving opportunity of hearing to the petitioner. It was held as follows: 'We have perused the order dated 79.Q4.2022. This is an order passed by the fint appellate authoriry under Section L07(1) of the CGST Act. As per sub-section (1) of Section 102 of the CGST Act, limitation for filing t zoz?(7) TMt gZ : 6. Though a further appeal before the appellate Tribunal is - I appeal is three rnontlx from the date of cornm,rnicatiorr of the order appealed against. Under sub-section (4) of Section 107 of the CGST Act, the appellate authodty may allow the appeal to be presented within a further period of one month, provided sufficient cause is shown by the appellant. Though the lower appellate authority may be right in holding that while it may allow filing of an appeal beycnd the limitation of tluce months for :r furthe r period of one month, thqrefore, by extension of limitation beyond the exended period of one month delay beyond the extended period of one month cannot bc condoned, we are of the view that such a stand taken by respondent No.l may advenely affect the petitioner. This is more so because rcspondent No.2 had sm ,ot cancelled the GST registration of the petitioner on the ground of non-filing of retums and as GST Tribunal has not been constituted under Section 109 of the CGST Act, petitioner would be left without any remedy. 'We funher find that the issue penains to cancellation of GST regisration of the petitioner. In the facts and circumstances of the case, it would be just and proper if dle entire matter is remanded back to respondent No.2 to recorsider the case of the petitioner and thereafter to pass appropriate order in accordance with law. I i I I I
5 In the light of the above and without expressing any opinion on merit, we remand the matter back to the file of respondent No.2 to consider the grievance expressed by the petitioner against cancellation of GST registration and thereafter pass an appropriate onder in accodance with law. Needless to say, when the respondent No.2 hears the maner on remand, petitioner shall submit all the retums as per the statue.
Thus, following the above decision, we set aside the order dated 11..12.2AD passed by respondent No2 as well as the order dated 19.04-2022 passed by respondent No.1 and remand the mafter back to respondent No,2 for a fresh decision in accordance with law. Respondent No.2 shall afford a reasonable opponuniry of hearing to the petitioner rrhile passing the fresh order on remand. In the remand proceedings, it will be open to the petitioner to submit the GST renlrns as per the statute.
It is clarfied that we have not exprdssed any opinion on ment. ) )
-- 6 10. 'Writ Petition is accordingly allowed to the exrenr indicated above. No costs. As a sequel, miscellaneous peririons, pending if any, stand closed. ,/ . N. CHANDRA SEKHAR RAO ASSISTANT REGISTRAR ,/ //' ,' ./ SECTION OFFICER \ Ir To,
The Additional Commissioner, (Appeals-1), O/o. The Commissioner of Customs and Central Tax, Appeals-[, Hyderabad Commissionerate, Basheerbagh, Hyderabad 500 004. 2. Superintendent of Central Tax, Vanasthalipuram-ll, Ranga Reddy GST Commissionerat, Hyderabad.
One CC to SRl. VENKATRAM REDDY MANTUR Advocate [OPUC]
One CC to M/s. NARSIMHA SHARMA, SC FOR CENTRAL EXCISE [OPUC]
Two CD Copies Kar GJP SJ
HIGH COURT DATE D : 1 610212023 1 $E Sle]' ( D g o6llARzon ( 1 (: ), R WP.No.4196 of 2023 ALLOWING OF THE WRIT PETITION WITHOUT COSTS e) \
Reproduced from the public record of the Telangana High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.