M/S Fruitful Buildcon Private Limited vs. The Appellate Authority-Ii

Held

The Court held that while the Appellate Authority is bound by statutory limitation provisions, non-adjudication of the appeal on merits would cause grave injury and prejudice to the petitioner, considering the reasons for the delay were beyond their control. Following the consistent view of the Rajasthan High Court in cited judgments and respectfully agreeing with the Punjab and Haryana High Court's view in Luxmi Traders, the Court decided to condone the delay in filing the appeal. The reasoning was that service of a Show Cause Notice (SCN) or Order-in-Original solely by uploading on the common portal may not be deemed sufficient unless receipt is acknowledged or a reply is filed. If an appeal is dismissed on limitation grounds after such service, the order of the Appellate Court should be set aside, and the appeal restored to be heard and decided on merits. The Court allowed the writ petition to the extent of condoning the delay. The Appellate Authority is directed to entertain the petitioner's appeal and adjudicate it on merits, provided the appeal is filed within 30 days of the instant order being uploaded.

Facts

The petitioner, M/s Fruitful Buildcon Private Limited, is challenging an appellate order dated January 6, 2026, by the Appellate Authority-II, State Tax, Jaipur-II. This order rejected their appeal against an Order-in-Original dated March 12, 2024, passed by the Joint Commissioner/Deputy Commissioner, State Tax, Business Audit Circle-I. The Order-in-Original raised a GST demand of Rs. 23,48,740/- for the financial year 2018-19, arising from an audit under Section 65 of the RGST Act. The petitioner's appeal was filed 22 days late, and the Appellate Authority dismissed it solely on limitation grounds, stating it lacked the power to condone the delay under Section 107(4) of the RGST Act. The petitioner argues the delay was due to bona fide circumstances, including the non-service of the Order-in-Original and the departure of their GST compliance employee.

Key Issues

1. Whether the Appellate Authority erred in dismissing the petitioner's appeal solely on the ground of limitation under Section 107(4) of the RGST Act, without considering the reasons for the delay and the merits of the case? (Question of law and mixed fact and law). Petitioner's arguments: The delay in filing the appeal was due to bona fide circumstances beyond their control, including the Order-in-Original not being effectively served and the employee responsible for GST compliances having left their employment. The Order-in-Original itself was passed in violation of Section 75(4) of the CGST/RGST Act, 2017, and principles of natural justice, as no personal hearing was granted despite a specific request. The Appellate Authority failed to consider these circumstances or adjudicate the substantive challenge on merits. They rely on Division Bench judgments of the Rajasthan High Court (M R Traders, Molana Construction Company, Man Singh Tanwar, RPC PSIPL JV) and a Punjab and Haryana High Court judgment (Luxmi Traders). Respondents' arguments: The impugned order was rightly passed, and the appeal is now barred by limitation.