2025 (5) TMI 257 - HC - GST

Compliance with the provisions of Rule 108 of the GST Rules - appeal filed manually due to non-availability of the order-in-original on GST portal - non-issuance of provisional acknowledgment upon manual filing of the appeal - HELD THAT - The Appellate Authority has failed to comply with the provisions of Rule 108(1) of the GST Rules and ignoring the fact that the order-in-original was not available on GST portal so as to enable the petitioner to file the appeal electronically the Appellate Authority ought to have considered the appeal filed by the petitioner manually and could not have rejected the same on technical ground that the appeal was not filed electronically. In fact the petitioner has followed the procedure prescribed under the GST Rules by filing an appeal manually due to nonavailability of order-in-original on GST portal. The Appellate Authority has not even bothered to look into GST portal as to whether the order-in-original was uploaded and in spite of the order being available on GST portal the petitioners did not file the appeal electronically. The Appellate Authority without arriving at such attitude mechanically and without application of mind has observed as under after quoting Rule 108 of the GST Rules. Hence we are of the view that there is total nonapplication of mind to the facts of the case that the appeal was filed manually due to non-availability of the order-in-original on GST portal. The impugned order-in-original dated 30.10.2023 passed by respondent No.1 is therefore set aside only on this ground and the matter is remanded to the Appellate Authority to consider the appeal filed by the petitioners on merit within a period of 12 weeks from the date of receipt of this order. The petition is accordingly disposed of.

1. ISSUES PRESENTED and CONSIDERED

The core legal questions considered by the Court were:

(a) Whether the Appellate Authority was justified in rejecting the appeal filed by the petitioners on the ground that the appeal was not filed electronically as prescribed under Rule 108 of the Central Goods and Services Tax Rules, 2017 (GST Rules);

(b) Whether the petitioners were entitled to file the appeal manually under the proviso to Rule 108(1) of the GST Rules due to non-availability of the order-in-original on the GST portal;

(c) Whether the Appellate Authority complied with the procedural mandate under Rule 108(1), particularly the issuance of provisional acknowledgment upon manual filing of the appeal;

(d) Whether the impugned order-in-original dated 30.10.2023 passed by the Assistant Commissioner was available on the GST portal at the relevant time, thereby affecting the mode of filing the appeal;

(e) Whether the appeal filed manually by the petitioners should have been considered on merits or was liable to be rejected on technical grounds.

2. ISSUE-WISE DETAILED ANALYSIS

Issue (a) and (b): Validity of rejection of appeal on ground of non-electronic filing and entitlement to manual filing under Rule 108(1) proviso

The relevant legal framework is Section 107 of the Central Goods and Services Tax Act, 2017 (CGST Act) which governs appeals to the Appellate Authority, and Rule 108(1) of the GST Rules which prescribes the manner of filing such appeals. Rule 108(1) states that an appeal shall be filed in FORM GST APL-01 electronically or otherwise as notified by the Commissioner. The proviso to Rule 108(1) permits manual filing of the appeal only if either the Commissioner has notified such mode or the appeal cannot be filed electronically due to non-availability of the order-in-original on the common portal. In such cases, a provisional acknowledgment must be issued immediately to the appellant.

The Court noted that the petitioners filed the appeal manually with a pre-deposit of 10% of disputed dues, citing non-availability of the order-in-original on the GST portal as the reason for manual filing. The Appellate Authority rejected the appeal solely on the ground that it was not filed electronically, without considering the proviso to Rule 108(1).

The Court observed that the Appellate Authority failed to verify whether the order-in-original was uploaded on the GST portal at the time of filing the appeal. The petitioners' contention that the order was not available electronically was not rebutted, and the Appellate Authority did not issue the mandatory provisional acknowledgment as required by the proviso.

The Court emphasized that the Appellate Authority's mechanical rejection of the appeal without application of mind to the facts and the legal provisions constituted a failure to comply with Rule 108(1). The petitioners had followed the procedure prescribed for manual filing due to non-availability of the order on the portal, and such appeal ought to have been accepted.

Issue (c): Compliance with procedural requirements under Rule 108(1)

The Court highlighted that the proviso to Rule 108(1) mandates issuance of provisional acknowledgment immediately upon manual filing of the appeal when electronic filing is not possible. The Appellate Authority merely acknowledged receipt of the letter on 17.01.2024 but did not issue any provisional acknowledgment in FORM GST APL-02 as required.

This procedural lapse was material and contributed to the invalid rejection of the appeal. The Court found that the Appellate Authority's failure to issue provisional acknowledgment and consider the appeal on merits amounted to non-application of mind and procedural impropriety.

Issue (d): Availability of order-in-original on GST portal

The Court noted that the Appellate Authority did not verify the availability of the order-in-original on the GST portal at the time of appeal filing. The petitioners contended that the order dated 30.10.2023 passed by the Assistant Commissioner was not uploaded on the portal, which prevented electronic filing.

The Appellate Authority's order did not address or disprove this contention but rejected the appeal on the assumption that electronic filing was possible and mandatory. The Court found this to be a critical oversight undermining the validity of the rejection.

Issue (e): Consideration of appeal on merits versus rejection on technical grounds

The Appellate Authority rejected the appeal solely on the technical ground of non-electronic filing without considering the merits or the factual circumstances justifying manual filing. The Court held that such rejection without application of mind to the facts and law was unsustainable.

The Court set aside the impugned order-in-original dated 30.10.2023 on this ground and remanded the matter to the Appellate Authority with directions to consider the appeal on merits within 12 weeks from receipt of the order.

The Court explicitly declined to express any opinion on the maintainability or merits of the appeal beyond the procedural issue of mode of filing and acceptance thereof.

3. SIGNIFICANT HOLDINGS

The Court held:

"The Appellate Authority has failed to comply with the provisions of Rule 108(1) of the GST Rules and ignoring the fact that the order-in-original was not available on GST portal so as to enable the petitioner to file the appeal electronically, the Appellate Authority ought to have considered the appeal filed by the petitioner manually and could not have rejected the same on technical ground, that the appeal was not filed electronically."

"There is total nonapplication of mind to the facts of the case that the appeal was filed manually due to non-availability of the order-in-original on GST portal."

"The impugned order-in-original dated 30.10.2023 passed by respondent No.1 is therefore set aside only on this ground and the matter is remanded to the Appellate Authority to consider the appeal filed by the petitioners on merit within a period of 12 weeks from the date of receipt of this order."

Core principles established include:

- The proviso to Rule 108(1) of the GST Rules permits manual filing of appeals when electronic filing is not possible due to non-availability of the order on the common portal.

- The Appellate Authority is obligated to verify the availability of the order on the GST portal before rejecting an appeal on the ground of mode of filing.

- The Appellate Authority must issue a provisional acknowledgment upon manual filing under the proviso.

- Mechanical rejection of appeals without application of mind to these facts and procedural requirements violates principles of natural justice and statutory mandates.

- Appeals filed manually under the proviso must be considered on merits and not rejected on technical grounds.

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