M/S Ali Infra vs. The State Of Bihar
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The petitioner, M/s Ali Infra, had its GST registration canceled by an order dated 22.06.2023. Subsequently, it filed an application for revocation of this cancellation. The application was filed beyond the prescribed one-month limitation period. However, the delay was condoned by an order dated 04.08.2023, purportedly under the proviso to Section 30 of the CGST Act. Despite the condonation of delay, the application for revocation was refused by an order dated 18.09.2023. The petitioner then filed an appeal against this refusal order. The first appellate authority rejected the appeal on the ground of delay, calculating the period from the original cancellation order dated 22.06.2023.
Held
The Court held that the proviso to Section 30 of the CGST Act, allowing for condonation of delay in filing revocation applications, was indeed applicable at the time the delay was condoned on 04.08.2023, as the omission of this proviso by the Finance Act, 2023, was effective only from 01.10.2023. Therefore, the condonation of delay was proper. Regarding the appeal, the Court found that the appellate authority erred in computing the limitation period from the original cancellation order dated 22.06.2023. Instead, the period should have been computed from the impugned order refusing revocation, which was dated 18.09.2023. Consequently, the appeal was to be treated as filed within time. The Court set aside the appellate order dated 20.12.2023 and remanded the appeal back to the appellate authority for consideration on merits after providing the petitioner an opportunity of hearing. The Court explicitly stated it made no observations on the merits of the cancellation or its revocation.
Key Issues
1. Whether the proviso to Section 30 of the CGST Act, which allowed for condonation of delay in filing an application for revocation of registration cancellation, was applicable at the time the delay was condoned, considering its subsequent omission by the Finance Act, 2023? - Petitioner's argument: The proviso to Section 30 was applicable because the delay condonation order dated 04.08.2023 was passed prior to the effective date of omission of the proviso (01.10.2023) by the Finance Act, 2023. - Revenue's argument: Not recorded. 2. Whether the appeal filed against the order refusing revocation of cancellation was within the prescribed limitation period, considering the date from which the period should be computed? - Petitioner's argument: The appeal period should be computed from the date of the order refusing revocation (18.09.2023), not the original cancellation order (22.06.2023), making the appeal within time. - Revenue's argument: Not recorded.
Sections Cited
Section 30
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Cause title — parties, addresses and appearances
ORAL ORDER (Per: HONOURABLE THE CHIEF JUSTICE) 5 16-05-2024 The petitioner’s registration was canceled as per the order dated 22.06.2023 which is produced as Annexure- P2. The cancellation was also effected after Annexure-P1 notice was issued.
The petitioner filed an application for revocation of cancellation of registration under Section 30 of the Central Goods and Services Tax Act, 2017 (For brevity the 2/3 CGST Act). The same was filed beyond the limitation period of one month but the limitation was condoned as per the proviso to Section 30 of the CGST Act which permitted such condonation of delay. Annexure-P3 order condoned the delay but Annexure-P4 refused to revoke the cancellation.
A question arose as to whether, the proviso was applicable since it was omitted by the Finance Act, 2023 (No. 8 of 2023). We are informed that the Act of 8 of 2023 was notified on 31.07.2023 but, omission of the proviso with effect from 01.10.2023. The delay condonation was effected by Annexure-P3 dated 04.08.2023 prior to the date on which the omission was given effect. Hence, the delay condonation was proper.
An appeal was filed from Annexure-P4 order which rejected the application for revocation of cancellation of registration. The first appellate authority rejected it on the ground of delay. The delay alleged is by computing the period from the date of the original order of cancellation, which is 22.06.2023. We have seen from the appeal memorandum that what has been challenged is the order dated 18.09.2023 which was passed by the Joint Commissioner, Sales Tax, Patna City West Circle which is 3/3 Annexure-P4, rejection of revocation of cancellation.
In such circumstances, the appeal has to be treated to be on time computing the period from 18.09.2023 Annexure-P4, which is the impugned order in the appeal.
In the aforesaid circumstances, we set aside the appellate order dated 20.12.2023 (Annexure-P5) and resurrect the appeal to the files of the appellate authority. The appellate authority shall consider the same on merits after affording an opportunity of hearing to the petitioner. Accordingly, the writ petition stands allowed.
We make it clear that we have not made any observation on the merits of cancellation or its revocation.
brajesh/- (K. Vinod Chandran, CJ) ( Harish Kumar, J) U
Reproduced from the public record of the Patna High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.