M/S. Mohankar Timber Company Thr. Sanjay S. Mohankar vs. The Union Of INDIA Thr. Chief Commissioner Central Tax And Ors
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The Petitioner, M/s Mohankar Timber Company, challenged an order dated January 31, 2022, passed by the Commissioner of Central Tax (Appeals-II), Pune. The Petitioner's GST registration was cancelled on January 28, 2021, due to non-filing of returns for six months. The Petitioner filed an appeal under Section 107 of the GST Act. The Commissioner (Appeals) found the appeal within the limitation period but rejected it as not maintainable, reasoning that the Petitioner had not approached the jurisdictional CGST authority for revocation of cancellation under Section 30 of the Act after the cancellation order was issued, as per statutory timelines.
Held
The Court held that the Commissioner (Appeals) erred in rejecting the appeal as not maintainable. While the Commissioner (Appeals) correctly noted that the appeal was filed within the limitation period, it should have granted the Petitioner an opportunity to file an application under Section 30 of the CGST Act for revocation of cancellation, especially since the Petitioner had relied on previous decisions of this Court where such an opportunity was granted. The Court observed that if the appellate authority concluded that the Petitioner ought to have filed an application for revocation, it should have provided an opportunity to do so. The Court found that the Commissioner (Appeals) had failed to do this, instead rejecting the appeal on maintainability grounds. The ratio decidendi is that in cases where an appeal against cancellation of registration is filed and the authority finds that a revocation application under Section 30 should have been filed, the authority should grant an opportunity to file such an application before rejecting the appeal on maintainability.
Key Issues
1. Whether the appeal filed under Section 107 of the GST Act against the order of cancellation of GST registration was maintainable when the Petitioner had not first sought revocation of cancellation under Section 30 of the CGST Act? 2. Whether the Commissioner (Appeals) erred in rejecting the appeal as not maintainable without granting the Petitioner an opportunity to file an application for revocation of cancellation under Section 30 of the CGST Act, despite finding the appeal within the limitation period? Petitioner's arguments: The Petitioner contended that this Court, in similar circumstances in Writ Petition No. 5273 of 2022 and Writ Petition No. 11618 of 2022, had granted an opportunity to file an application under Section 30 of the CGST Act and urged for the same course of action. Revenue's arguments: The judgment records no specific arguments from the Respondents.
Sections Cited
Section 107, Section 30
AI-generated summary — verify with the full judgment below
1 27 wp 665-23-c.doc IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURI ICTION WRIT PETITION NO.665 OF 2023
M/s Mohankar Timber Company … Petitioner V/s. The Union of India and ors. … Respondents --- Mr.Deepak Bapat with Ms.Sonali Bapat, Advocates for the Petitioner. Mr.Ram Ochani, Advocate for Respondents No.1 and 3. Ms.Shruti Vyas, “B” Panel Counsel for Respondent No.2. --- CORAM : NITIN JAMDAR AND ABHAY AHUJA, JJ. DATE : 22 FEBRUARY 2023. P.C.:-
By this petition, the Petitioner is challenging Order No.PUN- CT-APRIL-ADC-000-379-2021-22 dated 31 January 2022 passed by the Commissioner of Central Tax (Appeals-II), Pune under the GST Act rejecting Petitioner’s appeal as not maintainable.
The brief facts are that the Petitioner having GSTIN registration No.27ACDPM3243NIZE was issued a show cause notice dated 7 January 2021 for cancellation of registration as Petitioner had not filed returns for a continuous period of six months. After considering the Priya Soparkar PRIYA RAJESH SOPARKAR RAJESH SOPARKAR Date: 2023.03.01 16:26:28 +0530
2 27 wp 665-23-c.doc reply of the Petitioner, the Petitioner’s GSTIN registration was cancelled vide order dated 28 January 2021. An appeal was filed against the order of cancellation of GST registration under section 107 of the GST Act. By the impugned order dated 31 January 2022, although the Commissioner (Appeals) found the appeal to be within the period of limitation, holding that since Petitioner did not approach the juri ictional CGST authority for revocation of cancellation of registration under section 30 of the Act after issuance of the cancellation order as per the time lines provided under the law, rejected the appeal filed by Petitioner as not maintainable.
Learned counsel for the Petitioner has drawn our attention to the decisions of this court in Writ Petition No.5273 of 2022 and in Writ Petition No.11618 of 2022 to submit that this court in similar circumstances has granted an opportunity to the Petitioner therein to file an application before the authority under section 30 of the CGST Act and submit that the same course of action be adopted in the case of the Petitioner herein.
We have heard learned counsel for the parties and also perused the petition as well as the reply filed by the Respondents.
A perusal of the impugned order clearly indicates that although the Commissioner (Appeals) has relied upon the suo-moto orders of the Supreme Court in respect of the limitation period considered the same and held the same to be within limitation, however, it has held Priya Soparkar
3 27 wp 665-23-c.doc 4 27 wp 665-23-c.doc appropriately reflects this position and are quoted as under: “4 Upon perusal of the order passed by the Appellate Authority, the Appellate Authority, it appears, did not discuss the matter on merits. Only on the ground that the present Petitioner had an opportunity to comply with the provisions of the regulations / statute and the Petitioner failed to avail of the remedy under Section 30 of the CGST Act for revocation of cancellation of the registration, the Appellate Authority has failed to entertain the appeal. The Appellate Authority, if it came to the conclusion that the Petitioner ought to have filed an appeal before the same Authority for revocation, then ought to have accorded an opportunity to the Petitioner to file an Application. 5 The Appellate Authority, it appears, has condoned the delay in filing the appeal, as the appeal was admitted and heard on merits. However, no decision on merit was given. The appeal was filed on 13th December 2021. Under Section 30, the Application has to be filed within 30 days. The Additional Commissioner or the Assistant Commissioner may extend the time for 30 more days and the Commissioner can extend it for further 30 days. 6 Considering the conspectus of the matter, we are inclined to accord an opportunity to the Petitioner to file an Application before the Authority under Section 30 of the CGST Act. 7 In case the Application is filed by the Petitioner within 15 days from today under Section 30 of the CGST Act before the Authority, the Authority shall Priya Soparkar
5 27 wp 665-23-c.doc construe the same within limitation and take decision upon the Application on merits, expeditiously.”
Considering the above discussion and the conspectus of the matter, we are inclined to afford an opportunity to the Petitioner to file an application to the authority under section 30 of the CGST Act. It is made clear that if an application is made by Petitioner within 15 days from today before the authority under section 30 of the CGST Act, the authority to consider the same and take a decision on merits as expeditiously as possible within a period of three months from today.
Writ Petition is accordingly disposed of. No costs.
(ABHAY AHUJA, J.)
(NITIN JAMDAR, J.) …. Priya Soparkar
Reproduced from the public record of the Bombay High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.