National Insurance Co. LTD. Thru. Authorized Signatory D.Y. Manager Nitin Rajpal vs. Addl. Commissioner, Commercial Tax, Grade-Ii Appeal, Lko. And Another

Facts

The petitioner, National Insurance Co. Ltd., challenged an order dated 30.08.2024 passed by the Additional Commissioner, Commercial Tax, Grade-II Appeal, Lucknow. This order dismissed the petitioner's appeal as being filed beyond the limitation period. The petitioner argued that the limitation period should commence from the date of rejection of their rectification application on 20.04.2024, not from the original order under Section 74 of the GST Act dated 27.10.2023. The petitioner contended that the appellate authority failed to consider this aspect and did not provide any reasons for dismissing the appeal as time-barred. The petitioner relied on a previous judgment of the High Court in the case of New Shanti Restaurant vs. State of U.P. & Ors.

Held

The Court held that the impugned order dated 30.08.2024, which dismissed the petitioner's appeal as being beyond limitation, was liable to be quashed. The Court found that the appellate authority had failed to record any reasons for its decision, which is a fundamental requirement. Furthermore, the Court noted that the appellate authority had not considered the petitioner's submission regarding the starting point of the limitation period, which the petitioner argued should be the date of rejection of their rectification application (20.04.2024). Applying the reasoning from the case of New Shanti Restaurant vs. State of U.P. & Ors., the Court found a prima facie case for interference. Consequently, the matter was remanded to the appellate authority to pass a fresh order in accordance with law, after duly considering all submissions made by the petitioner. The Court did not expressly leave any issue undecided.

Key Issues

1. Whether the appellate authority erred in dismissing the petitioner's appeal as being beyond limitation without recording any reasons, thereby violating principles of natural justice and the requirements of Section 107 of the CGST Act, 2017? 2. Whether the limitation period for filing the appeal should commence from the date of the order under Section 74 of the GST Act (27.10.2023) or from the date of rejection of the petitioner's rectification application (20.04.2024)? Petitioner's Arguments: The petitioner argued that the appellate authority failed to record any reasons for dismissing the appeal as time-barred. They contended that the starting point for calculating the limitation period should be the rejection of their rectification application on 20.04.2024, as this order was passed after the initial order under Section 74 of the GST Act. They relied on the judgment in New Shanti Restaurant vs. State of U.P. & Ors. to support their claim that reasons must be provided for such dismissals. Respondent's Arguments: The learned Standing Counsel for the State did not record any specific arguments in the judgment.