2025 (6) TMI 1651 - HC - GST

Rejection of appeal on the ground of time limitation - petitioner had already paid 10% towards statutory pre-deposit while filing the appeal and now he is willing to pay additional pre-deposit of 15% of disputed tax amount - HELD THAT - In the case on hand the ex-parte assessment order came to be passed on 31.08.2023. Aggrieved over the same an appeal was belatedly preferred by the petitioner on 09.02.2024 i.e. with a delay of 72 days. Since the delay was beyond the condonable period the said appeal was rejected by the respondent vide impugned order dated 27.12.2024. According to the petitioner since the assessment order was passed in ex-parte they remained unaware of the said order and hence they were unable to file the appeal within time - The above reason assigned by the petitioner for the delay in filing the appeal against the assessment order appears to be genuine. In such view of the matter this Court is inclined to condone the delay in filing the appeal against the impugned assessment order on terms. Though the petitioner had already paid 10% of the disputed tax amount as statutory pre-deposit while filing the appeal considering the delay of 72 days this Court directs the petitioner to pay additional 15% of the disputed tax amount to the respondents as agreed by the petitioner. Conclusion - The 72-day delay in filing the appeal is condoned on the ground of genuine unawareness of the ex-parte order. Petition disposed off.

Summary

1. ISSUES PRESENTED and CONSIDERED

- Whether the delay of 72 days in filing the appeal against the ex-parte assessment order can be condoned despite being beyond the statutory condonable period.

- Whether the petitioner's claim of unawareness of the ex-parte assessment order due to non-notification, despite uploading on the GST common portal, constitutes sufficient cause for condonation of delay.

- Whether the petitioner's offer to pay an additional pre-deposit of 15% of the disputed tax amount, over and above the initial 10% pre-deposit, is sufficient and appropriate as a condition for condoning the delay.

- Whether the rejection order passed by the respondent on the ground of limitation should be set aside and the appeal be admitted for adjudication on merits.

2. ISSUE-WISE DETAILED ANALYSIS

Delay in Filing Appeal and Condonation

The legal framework governing appeals against GST assessment orders mandates strict adherence to limitation periods. The respondent rejected the appeal due to a delay of 72 days, which exceeded the condonable period prescribed under the relevant GST appellate provisions.

The petitioner contended that the delay arose from unawareness of the ex-parte assessment order, which was uploaded on the GST common portal but went unnoticed. This lack of actual notice prevented timely filing of the appeal. The Court examined whether such a circumstance qualifies as sufficient cause for condonation.

The Court acknowledged that while procedural requirements demand notice and timely filing, the petitioner's inability to notice the uploaded order was a genuine reason. The Court recognized that ex-parte orders may not come to the attention of the affected party unless actively monitored on the portal. This reasoning aligns with principles that delay caused by non-receipt of notice or unawareness, especially in electronic communication systems, can constitute sufficient cause for condonation if bona fide.

The Court balanced the competing arguments: the respondent's insistence on strict limitation compliance versus the petitioner's genuine unawareness. The Court found the petitioner's explanation credible and sufficient to justify condonation of delay subject to conditions.

Pre-deposit Condition for Condonation

Statutory provisions require a pre-deposit of a percentage of the disputed tax amount as a condition precedent for entertaining appeals. The petitioner had already deposited 10% at the time of filing the appeal. Given the delay of 72 days, the Court considered the petitioner's willingness to pay an additional 15% pre-deposit as a factor mitigating the delay and ensuring compliance with statutory safeguards.

The Court's direction to pay the additional 15% pre-deposit serves as a balancing measure: it protects the revenue interest while permitting the petitioner to pursue the appeal on merits. This approach is consistent with precedents that allow condonation of delay with enhanced pre-deposit as a condition.

Setting Aside the Rejection Order and Admission of Appeal

On condoning the delay and subject to the payment of the additional pre-deposit, the Court set aside the impugned rejection order dated 27.12.2024. The Court directed the respondent to admit the appeal and proceed to decide it on merits after affording the petitioner sufficient opportunity.

This ensures that procedural technicalities do not bar substantive adjudication where the petitioner has demonstrated bona fide reasons and complied with conditions imposed by the Court.

3. SIGNIFICANT HOLDINGS

"The above reason assigned by the petitioner, for the delay in filing the appeal against the assessment order, appears to be genuine. In such view of the matter, this Court is inclined to condone the delay, in filing the appeal against the impugned assessment order, on terms."

"Accordingly, the rejection order dated 27.12.2024 passed by the 1st respondent is set aside and the delay of 72 days in filing the appeal before the 1st respondent is hereby condoned, subject to the payment of additional 15% of the disputed tax amount by the petitioner to the 1st respondent."

"Upon payment of the said amount, the 1st respondent is directed to take the appeal on record and pass appropriate orders on merits and in accordance with law, after providing sufficient opportunity to the petitioner, as expeditiously as possible."

Core principles established include:

• Delay in filing an appeal beyond the condonable period can be condoned if the petitioner demonstrates genuine cause, such as unawareness of an ex-parte assessment order uploaded on an electronic portal.
• The petitioner's bona fide explanation for delay coupled with willingness to pay an enhanced pre-deposit amount justifies condonation.
• Rejection orders based solely on limitation grounds are subject to judicial review and can be set aside on sufficient cause and compliance with conditions.
• Courts balance procedural compliance with substantive justice, ensuring appeals are heard on merits where possible.

Final determinations on each issue are:

• The 72-day delay in filing the appeal is condoned on the ground of genuine unawareness of the ex-parte order.
• The petitioner must pay an additional 15% pre-deposit of the disputed tax amount as a condition for condonation.
• The impugned rejection order is set aside, and the appeal is to be admitted and decided on merits after due opportunity.