M/S Micro Zone, (A Sole Proprietorship Firm) vs. The Union Of INDIA

Facts

The petitioner, M/s Micro Zone, filed a writ petition challenging the rejection of its delayed appeal by the Additional Commissioner (Appeal) of State Tax, Purnea Division, vide order dated September 19, 2023 (Annexure-5). The appeal was rejected for being filed beyond the period of limitation prescribed under Section 107 of the BGST Act, which allows three months for filing an appeal and an additional one month with a satisfactory explanation for delay. The petitioner's appeal was filed even beyond this extended period. The petitioner sought relief from the High Court.

Held

The Court held that while generally, delays beyond the statutory period cannot be condoned by the Appellate Authority or the High Court, Notification No. 53 of 2023-Central Tax provides a special procedure for filing delayed appeals against orders passed under Sections 73 and 74 of the BGST Act. This notification extends the time for filing appeals up to January 31, 2024. The Court found that the petitioner's appeal, though rejected, could be restored subject to satisfying the conditions stipulated in paragraph 3 of the notification. These conditions include paying the admitted portion of tax, interest, fine, fee, and penalty, and 12.5% of the remaining disputed tax amount (with at least 20% of this 12.5% paid from the Electronic Cash Ledger), subject to a maximum of twenty-five crore rupees. The Court set aside the impugned order of rejection on the condition that the petitioner complies with these requirements by January 31, 2024. If conditions are met, the appeal will be considered on merits; otherwise, the rejection order stands. The Court allowed the writ petition on these terms.

Key Issues

1. Whether the High Court or the Appellate Authority can condone delay in filing an appeal beyond the period stipulated in Section 107 of the BGST Act? (Question of law). The petitioner contended that the delay should be condoned, implicitly relying on the possibility of relief through subsequent notifications. The revenue/state argued that when a specific period is provided in the statute for filing a delayed appeal, neither the Appellate Authority nor the High Court under Article 226 can condone delays beyond that period. 2. Whether Notification No. 53 of 2023-Central Tax, dated November 2, 2023, which extends the time for filing appeals against orders passed under Sections 73 and 74 of the BGST Act, is applicable to the petitioner's case and can be used to revive the rejected appeal? (Question of mixed law and fact). The petitioner implicitly argued for its applicability. The revenue/state did not explicitly argue against the notification's applicability but focused on the statutory limitations.