Facts of the Case

The petitioner, New Kabady Shop, challenged the order dated 24 June 2025 passed by the Appellate Authority, Sales Tax Department, Kashmir Division, Srinagar. By the said order, the petitioner’s appeal filed online on 06 June 2025 under Section 107 of the GST Act against Demand Order No. ZD010225002391A, passed by the Assessing Authority, Circle Budgam, Kashmir, on 05 February 2025, was rejected on the ground that it had not been filed within the prescribed period of limitation under the GST Act.

It was undisputed that the petitioner filed the appeal before the Appellate Authority on 06 June 2025 against the Assessing Authority’s order dated 05 February 2025.

Under Section 107(1), an appeal against an order passed by the adjudicating authority may be filed before the Appellate Authority within three months from the date on which the decision or order is communicated to the aggrieved person. Under Section 107(4), the Appellate Authority may condone delay only for a further period of one month. Beyond that additional one-month period, the Appellate Authority has no jurisdiction to condone the delay.

In the present case, the appeal was filed after expiry of the prescribed three-month period plus the further one-month period capable of being condoned by the Appellate Authority. The delay beyond the prescribed extendable limitation period was only one day.

Issues Involved

The principal issues before the High Court were:

  1. Whether the High Court could come to the rescue of the petitioner where the GST appeal had been filed with a delay of only one day beyond the maximum extendable limitation period contemplated under Section 107(4) of the GST Act.
  2. Whether the statutory restriction under Section 107(4), which prevents the Appellate Authority from condoning delay beyond the additional period of one month, also bars the Constitutional Court from exercising its extraordinary jurisdiction to render substantial justice.
  3. Whether refusal to hear the petitioner’s appeal on merits, despite the minimal one-day delay and the explanation furnished for such delay, would operate harshly and result in injustice.

Petitioner’s Arguments

The petitioner’s case was that there was only one day’s delay in filing the appeal beyond the prescribed extendable period of limitation.

In the application made before the Appellate Authority, the petitioner pleaded that the petitioner’s sister had passed away, as a result of which the appeal could not be filed within the prescribed period of limitation.

The petitioner relied upon the principle recognised by the High Court in M/s Multi Trading Agencies, Drangbal vs UT of Jammu and Kashmir & Ors., WP(C) No. 1898 of 2024, decided on 17 October 2024, wherein it was held that the prohibition contained in Section 107(4) against condonation of delay beyond one month cannot come in the way of Constitutional Courts exercising extraordinary jurisdiction to render substantial justice.

Reliance was also placed on the similar view taken in M/s Parshotam Electronics vs State Taxes Officer, Circle-Q, Jammu, WP(C) No. 2909/2024, decided on 29 September 2025.

Respondent’s Arguments

The respondent was represented by learned Assisting Counsel. The order records that the Court heard learned counsel for the parties and perused the record.

The statutory position before the Court was that Section 107(1) prescribes a period of three months for filing an appeal from the date of communication of the decision or order, while Section 107(4) empowers the Appellate Authority to condone delay only to the extent of a further period of one month.

Accordingly, beyond that additional one-month period, the Appellate Authority itself does not possess jurisdiction to condone the delay. The impugned rejection of the petitioner’s appeal had been made on the ground that the appeal was not filed within the prescribed limitation period under the GST Act.

Court Order / Findings

The High Court observed that the petitioner’s appeal had been filed after expiry of the prescribed period of three months plus the further period of one month that could be condoned by the Appellate Authority. However, the delay beyond that period was only one day.

The Court relied upon M/s Multi Trading Agencies, Drangbal vs UT of Jammu and Kashmir & Ors., wherein it had been held that the prohibition contained in Section 107(4) of the Act of 2017 against condonation of delay beyond one month cannot prevent Constitutional Courts from exercising extraordinary jurisdiction to render substantial justice.

The Court reiterated that although the statutory prohibition is a strong consideration that must be kept in mind, it does not bar the jurisdiction of the High Court to condone delay where application of the delay-barring statute would result in gross injustice.

The Court also noted that a similar view had been taken in M/s Parshotam Electronics vs State Taxes Officer, Circle-Q, Jammu.

Applying these principles to the present case, the High Court took into account:

  • the fact that the delay was only one day beyond the prescribed extendable period of limitation; and
  • the petitioner’s explanation that the delay occurred because the petitioner’s sister had passed away.

The Court held that if the petitioner’s appeal were not heard on merits, it would work harshly against the petitioner. The petitioner deserved an opportunity to present the case before the Appellate Authority in order to meet the ends of justice.

Accordingly, the High Court:

  • allowed the writ petition;
  • set aside the impugned order passed by the Appellate Authority;
  • condoned the delay in filing the appeal; and
  • remanded the matter to the Appellate Authority for fresh consideration and decision on merits in accordance with law.

The connected CM was also disposed of.

Important Clarification

The judgment draws an important distinction between the limited statutory power of the GST Appellate Authority and the extraordinary constitutional jurisdiction of the High Court.

Under Section 107(4), the Appellate Authority may condone delay only for a further period of one month beyond the ordinary three-month limitation period. Therefore, the Appellate Authority has no jurisdiction to condone delay beyond that statutory outer limit.

However, according to the High Court’s reasoning and the precedents relied upon in the order, this statutory prohibition does not automatically bar a Constitutional Court from exercising extraordinary jurisdiction in an appropriate case to render substantial justice and prevent gross injustice.

At the same time, the order should not be read as laying down that every delay beyond Section 107(4) must be condoned. The Court specifically considered the exceptional factual circumstances of the present matter, particularly the minimal delay of only one day and the explanation concerning the death of the petitioner’s sister.

Sections Involved

Section 107(1) of the GST Act, 2017: Provides for filing an appeal before the Appellate Authority within three months from the date on which the decision or order is communicated to the aggrieved person.

Section 107(4) of the GST Act, 2017: Permits the Appellate Authority to condone delay for a further period of one month upon sufficient cause, but does not confer jurisdiction upon the Appellate Authority to condone delay beyond that additional period.

Link to download the order -https://www.mytaxexpert.co.in/uploads/1783069987_434compressed.pdf

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