Ms Ad Trading Company vs. Commissioner State Goods And Services Tax Commissionerate

Held

The Court held that the present case warranted interference due to its peculiar facts. The impugned order dated 24.06.2025, which rejected the petitioner's restoration application for Appeal No. 26 of 2021, was set aside. The Court ordered that Appeal No. 26 of 2021 be restored to its original number. The Appellate Authority was directed to decide the petitioner's appeal in accordance with the law. The reasoning was based on the extraordinary and peculiar circumstances that led to the appeal being dismissed as infructuous, including the evolving legal position on the maintainability of appeals against orders of the Assistant Commissioner, as clarified by the High Court's review order. The Court found that the petitioner should not be deprived of their right to appeal on merits due to these procedural complexities. The ratio decidendi is that procedural impediments arising from evolving legal interpretations should not prevent a party from having their substantive appeal heard, especially when the revenue and the petitioner's livelihood are at stake.

Facts

The petitioner, M/s A.D. Trading Company, had its GST registration cancelled by the Assistant Commissioner, Tanakpur, on 14.10.2020. The petitioner filed an appeal (Appeal No. 26 of 2021) under Section 107 of the GST Act before the Joint Commissioner (Appeal). Due to a High Court observation that appeals against orders of the Assistant Commissioner might not lie, the petitioner filed a withdrawal application for their appeal. Subsequently, a review order by the High Court clarified that such appeals were maintainable. The petitioner then sought to withdraw their writ petition pending before the High Court. In the interim, the Appellate Authority dismissed the petitioner's appeal as infructuous. The petitioner's subsequent application for restoration of the appeal was rejected by an order dated 24.06.2025, which is now challenged.

Key Issues

1. Whether the impugned order dated 24.06.2025, rejecting the petitioner's restoration application for Appeal No. 26 of 2021, is liable to be quashed, considering the peculiar facts and circumstances of the case, particularly in light of the High Court's earlier observations and subsequent review order regarding the maintainability of appeals against orders of the Assistant Commissioner under Section 107 of the GST Act? 2. Whether the respondents should be directed to allow the restoration application and restore the petitioner's appeal for hearing on merits? Petitioner's arguments: The petitioner contended that the cancellation of GST registration has rendered them remediless. They relied on a previous observation by the High Court in Special Appeal No. 123 of 2022, which suggested that appeals against orders passed by the Assistant Commissioner might not be maintainable under Section 107 of the GST Act. However, a subsequent review order in the same Special Appeal clarified the maintainability. The petitioner argued that due to these evolving legal pronouncements and the subsequent dismissal of their appeal as infructuous, their restoration application was wrongly rejected, and they should be allowed to pursue their appeal on merits. The cancellation of registration directly impacts their livelihood and the State's revenue. Respondent's arguments: The respondent stated they had no objection if the case was considered afresh by the Appellate Authority.