High Court Can Condon Delay in Filing Appeals Beyond Statutory Limit

Case Details

  • Case Name: Vasudeva Engineering v. Union of India
  • Court: Punjab & Haryana High Court
  • Citation: CWP Nos. 27468, 18475, 26077, 18591, and 5397 of 2023 (O&M)
  • Date: October 24, 2024

Key Issue

Can the High Court condone delays in filing appeals beyond the time limit prescribed under Section 107 of the CGST Act, 2017?

Key Facts

  1. Delay in Filing Appeals:
    • M/s Vasudeva Engineering, the petitioner, filed appeals under Section 107 of the CGST Act after paying the mandatory pre-deposit.
    • However, the appeals were submitted beyond the statutory timeline of three months, including the additional 30-day condonation period permitted under the CGST Act.
  2. Rejection by the Appellate Authority:
    • The appellate authority rejected the appeals, stating that it lacked jurisdiction to condone delays beyond the prescribed limit.

Observations by the Court

1. Limited Powers of the Appellate Authority

The CGST Act allows:

  • A 90-day window to file an appeal.
  • An additional 30 days for condonation of delay.

Beyond this timeframe, appellate authorities are powerless to entertain appeals.

2. High Court’s Jurisdiction under Article 226

The High Court, however, holds the constitutional power under Article 226 to condone delays that exceed statutory limits.

  • These powers are exercised to ensure justice when procedural lapses occur due to genuine reasons.

3. Relevant Judicial Precedents

  • M/s Tecnimont Pvt Ltd. v. State of Punjab & Others (2019):
    The Supreme Court affirmed that appellate authorities cannot condone delays beyond statutory limits. However, it recognized the High Court’s powers to intervene in deserving cases.
  • Steel Kart v. State of Haryana (2024):
    The High Court condoned delays since the petitioner was unaware of the order within the prescribed timeframe.

Court’s Holding

  • The appellate authority’s rejection of appeals due to delays was legally valid under the CGST Act.
  • Nevertheless, the High Court exercised its discretion under Article 226, condoning the delay and directing relief based on the facts and merits of the case.

Practical Implications

1. Filing Appeals on Time

Taxpayers must file appeals within:

  • 90 days as per the CGST Act, with an additional 30 days allowed for condonation.
  • Beyond this timeframe, the appellate authority cannot entertain the appeal.

2. Remedy through Writ Petitions

When appeals are dismissed due to delays:

  • Taxpayers can approach the High Court under Article 226.
  • The High Court may condone delays if procedural lapses occurred due to unforeseen or valid reasons.

3. Importance of Pre-Deposit

  • Payment of the mandatory pre-deposit signals the taxpayer’s genuine intent to appeal.
  • This often strengthens the case for delay condonation.

Our Comments

  • Section 107 of the CGST Act imposes strict timelines, often resulting in rejection of appeals due to procedural lapses.
  • However, Article 226 provides a constitutional safeguard, allowing the High Court to intervene and grant relief in genuine cases of delay.
  • Taxpayers should prioritize adhering to statutory timelines but can seek recourse through writ petitions if unexpected circumstances arise.
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