Facts of the Case

M/s Santosh Traders, a proprietorship engaged in supplying interlocking bricks, cement, and construction materials, challenged an order dated 26.12.2022 passed by the Additional Commissioner, Grade-2 (Appeal), State Tax, Gonda, dismissing its GST appeal as time-barred, as well as the underlying ex-parte order dated 14.07.2021 passed under Section 74(9) of the CGST/SGST Act. That underlying order had set aside GST already deposited via Form GSTR-3B and raised a fresh demand of 18% GST on total receipts of Rs.1,10,67,891/-, following a show-cause notice under Section 61 (Form GST ASMT-10) which the petitioner said it could not respond to because its office was non-functional during the COVID-19 pandemic. The petitioner's appeal under Section 107(1), filed on 19.07.2022, was dismissed as time-barred; the petitioner attributed the delay to his own serious illness (Pott's Spine/spinal tuberculosis) from 05.02.2021 to 19.07.2022, supported by a medical certificate. The matter was decided on 19.06.2023.

Issues Involved

  1. Whether the delay in filing the GST appeal was attributable to bona fide reasons and deserved condonation.
  2. Whether the Appellate Authority was justified in dismissing the appeal solely on the ground of limitation without considering the medical grounds pleaded.

Petitioner's Arguments

  • The delay in filing the appeal was due to the petitioner's serious and prolonged illness (spinal tuberculosis), supported by a medical certificate, and was thus a bona fide reason for the delay.
  • Under Section 112 of the SGST Act and the Central GST (Ninth Removal of Difficulties) Order, 2009, the limitation to appeal to the Appellate Tribunal had not expired, and the appeal ought to be heard on merits.

Respondent's Arguments

  • The State's Additional Chief Standing Counsel did not object to the petitioner being granted liberty to approach the Appellate Authority afresh for adjudication of the matter on merits.

Court Order / Findings

  • The Court found that although the appeal was admittedly filed beyond time, the reason for the delay — the petitioner's documented serious illness — prima facie appeared to be bona fide.
  • The impugned order dated 26.12.2022 dismissing the appeal on limitation was set aside, and the matter was remanded to the Appellate Authority with a direction to adjudicate the appeal on merits without raising any objection on limitation, provided the appeal (if refiled) was filed within two weeks.
  • The Court expressly clarified that this order was passed in the peculiar facts of the case and without entering into the merits of the underlying tax dispute.

Important Clarification

This is a limitation-condonation order, not a ruling on whether the GST demand of Rs.1.1 crore-plus receipts is correct — the Court expressly declined to examine the merits, sending the case back for a fresh, merits-based hearing before the Appellate Authority. It confirms that documented serious illness can be accepted as sufficient cause for delay in filing a GST appeal in appropriate cases.

Sections Involved

  • Central Goods and Services Tax Act, 2017 / U.P. Goods and Services Tax Act, 2017 — Section 61 (scrutiny of returns), Section 74(9) (determination of tax in fraud/suppression cases), Section 107(1) and 107(11) (appeal to first appellate authority), Section 112 (appeal to Appellate Tribunal)
  • Central Goods and Services Tax (Ninth Removal of Difficulties) Order, 2019

Decision – In Favour of

Decided in favour of the Petitioner, M/s Santosh Traders, to the limited extent of restoring the appeal on limitation grounds — the appellate order was set aside and remanded for a merits hearing; the tax dispute itself remains undecided.

Case Details

High Court of Judicature at Allahabad, Lucknow Bench | Writ Tax No.151 of 2023 | Neutral Citation: 2023:AHC-LKO:41659 | Coram: Hon'ble Syed Qamar Hasan Rizvi, J. | Order Date: 19.06.2023.

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