Jagdamba Jewellers vs. Chief Commissioner Of State Tax, Rajasthan

Held

The Court held that while the Appellate Authority is bound by the statutory provisions of limitation under Section 107 of the CGST/RGST Act, 2017, non-adjudication of the appeal on merits would cause grave injury and prejudice to the petitioner, considering the reasons for the delay were beyond their control. The Court, in respectful agreement with a Division Bench judgment of the Punjab and Haryana High Court in Luxmi Traders versus Union Territory of Chandigarh and Ors., concluded that the period of limitation for filing an appeal would not be triggered if the order-in-original was served only by uploading it on the Common Portal without acknowledgment or reply, and the appeal was dismissed on grounds of limitation. Therefore, the Appellate Authority was directed to entertain the petitioner's appeal and adjudicate it on merits, provided the appeal is filed within 30 days of the instant order being uploaded. The Court also noted that the original order rejecting the cancellation of GST registration was passed without a show cause notice or an opportunity to be heard, which is a violation of principles of natural justice.

Facts

The petitioner, Jagdamba Jewellers, sought a direction from the Rajasthan High Court to condone a delay of 574 days in filing an appeal against an Order-in-Original dated May 5, 2021. This order, passed by the Deputy Commissioner of State Tax, Jaipur, rejected the petitioner's application for cancellation of its GST registration. The appeal was filed on March 30, 2023. The Appellate Authority dismissed the appeal on April 5, 2023, citing its lack of power to condone such a delay. The petitioner contended that the delay was bona fide, arising from a lack of knowledge of the rejection order, as they had not regularly accessed the GST portal after applying for cancellation on February 22, 2021. They also argued the order was passed without a show cause notice or an opportunity to be heard, and they only became aware of it around February 17, 2023, through a purchaser.

Key Issues

1. Whether the petitioner has shown sufficient cause for the delay of 574 days in filing the appeal against the Order-in-Original dated May 5, 2021, thereby warranting condonation by this Court? (Question of law and fact, turning on Section 107 of the CGST/RGST Act, 2017 and principles of natural justice). Petitioner's Arguments: The delay was bona fide and not intentional, occurring because the petitioner was unaware of the rejection order for their GST registration cancellation application. They believed the application was being processed and did not regularly check the portal. The order was passed without a show cause notice or an opportunity to be heard. Knowledge of the order was gained only on February 17, 2023, through a purchaser. The delay was thus due to circumstances beyond their control and lack of effective communication. They relied on various Division Bench judgments of the Rajasthan High Court, including M/s M R Traders v. UOI, M/s Molana Construction Company v. Central Goods and Service Tax Department & Ors., Man Singh Tanwar v. Commissioner, Central Goods and Services Tax Department & Ors., RPC PSIPL JV Vs. State of Rajasthan & Ors. Respondents' Arguments: The impugned order dated May 5, 2021, was rightly passed because a show cause notice was duly uploaded on the GST Portal on that date due to the petitioner's failure to file a requisite return. Despite service of this notice, the petitioner failed to respond, leading to the order. The petitioner failed to avail the statutory remedy of appeal within the prescribed limitation period, making the present petition not maintainable at this belated stage.