Shri Laxman Das Jaisinghani vs. Union Of INDIA

Held

The Court held that the petitioner had sufficiently complied with the provisions of Section 107 of the CGST Act, 2017. Regarding the pre-deposit, the Court found that the petitioner had deposited Rs. 82,000/- in his GST Electronic Cash Ledger on 22.12.2022, which was acceptable as per the prevailing practice before 18.04.2023, especially since the Order in Original was not uploaded on the GST portal until 17.01.2023. The Court noted that manual filing of appeals was permissible in December 2022 and that the petitioner could not file an electronic appeal until the order was uploaded. Therefore, the petitioner had not committed any error in depositing the amount in his Electronic Cash Ledger and submitting the appeal through speed post. The Court concluded that there was no failure on the part of the petitioner in filing the appeal within the prescribed period of limitation and depositing the mandatory amount. The delay in preferring the appeal was condoned. The Order in Appeal dated 22.03.2024 was quashed and set aside. The matter was remitted to the Joint Commissioner (Appeals) to decide the appeal afresh on merits after giving adequate opportunity to the petitioner. The ratio decidendi is that procedural delays, especially when the appellant has made efforts to comply with statutory requirements like pre-deposit, should not lead to the dismissal of an appeal, and the delay should be condoned.

Facts

The petitioner, Shri Laxman Das Jaisinghani, proprietor of M/s Swastik Traders, is challenging an order dated 23.03.2024 passed by the Joint Commissioner (Appeals), Central GST & Central Excise, Bhopal. The petitioner had filed GSTR-1 and GSTR-3B returns for April 2018 to March 2019. Following a GST audit, a show cause notice was issued, leading to an Order in Original dated 22.09.2022 by the Superintendent CGST, Jabalpur. This order confirmed a tax demand of Rs. 8,02,813/- and imposed an equal penalty, holding that the petitioner wrongly availed Input Tax Credit (ITC) of Rs. 8,02,813/- for the period 2018-2019. The petitioner received the order on 30.09.2022. He deposited Rs. 82,000/- in his GST Electronic Cash Ledger on 22.12.2022. An offline appeal was filed on 20.01.2023, and an online appeal was filed on 13.04.2023, along with a pre-deposit of Rs. 80,283/-.

Key Issues

1. Whether the petitioner complied with the mandatory pre-deposit requirement under Section 107(6)(b) of the CGST Act, 2017, by depositing Rs. 82,000/- in his GST Electronic Cash Ledger on 22.12.2022, prior to filing the appeal? 2. Whether the online appeal filed on 13.04.2023 was within the prescribed time limit, considering the delay in uploading the Order in Original on the GST portal? Petitioner's arguments: The petitioner contended that he had complied with Section 107(6)(b) by depositing Rs. 82,000/- in his GST Electronic Cash Ledger, as pre-deposit through GST DRC-03 was not mandatory before 18.04.2023, and the Ministry of Finance's instructions dated 28.10.2022 did not prescribe GST DRC-03 as the sole mode. He argued that since the Order in Original was not uploaded on the GST portal until 17.01.2023, he could not have used GST DRC-03 and was justified in using the Electronic Cash Ledger. He further argued that the appellate authority failed to appreciate that the pre-deposit was made and the appeal should have been decided on merits. Revenue's arguments: The revenue opposed the petition, primarily on the ground that the appeal was not submitted within the prescribed period. However, the revenue fairly accepted that pre-deposit could be made through the GST Electronic Cash Ledger before 18.04.2023.