Dismissal of GST appeal without considering actual service date
violates justice: Delhi High Court orders restoration for fresh limitation
review
Summary of
the Case
The Delhi High Court set
aside an order passed by the Additional Commissioner of CGST Appeals-I,
who had dismissed an appeal filed by M/s CTC Geotechnical Pvt. Ltd. on
the ground that it was barred by limitation under Section 107(4) of the
CGST Act, 2017.
The crux of the
petitioner’s grievance was that they were served with the Order-in-Original
only on 30 April 2024, and not on 14 March 2024 (the date the order was
signed), which should be the relevant date for computing limitation. Since the
appeal was filed on 15 July 2024, they claimed it was well within time when
computed from the actual date of service.
The Court held that the
appellate authority had not properly examined the question of service, and
that a mechanical computation of limitation without considering the
factual matrix was not sustainable. The order dismissing the appeal was
therefore quashed, and the appellate authority was directed to re-examine
the limitation issue.
Case
Snapshot
- Petitioner:
M/s CTC Geotechnical Pvt. Ltd.
- Respondents:
Additional Commissioner, CGST Appeals-I, Delhi & CGST Department
- Case No.:
W.P.(C) 2801/2025 & CM APPL. 13326/2025
- Date of Judgment:
05 March 2025
- Court:
High Court of Delhi
Factual
Background
1. Order-in-Original
Issued
o An
adjudication order (Order-in-Original) was passed against the petitioner on 14
March 2024, raising a demand for tax, interest, and/or penalty.
o The
order was not immediately served on the petitioner, and DRC-07 (summary of
demand) was also issued but allegedly received only later.
2. Date
of Receipt Claimed by Petitioner
o The
petitioner claimed they received the Order-in-Original and DRC-07 only on 30
April 2024, not when the order was originally signed or uploaded.
3. Appeal
Filed
o The
petitioner filed their appeal under Section 107 of the CGST Act on 15
July 2024, which would be within the statutory limitation period if
calculated from 30 April 2024.
4. Appeal
Dismissed by Appellate Authority
o The
appellate authority held that the appeal should have been filed by 13 June
2024, assuming 14 March 2024 as the date from which limitation began.
o Since
the appeal was filed on 15 July 2024, it was dismissed as time-barred.
Legal Issue
Before the Court
Whether the appellate
authority was correct in computing limitation from the date of the order (14
March 2024) instead of the date of its actual service (30 April 2024), and in
dismissing the appeal as barred by limitation under Section 107(4) of the CGST
Act?
Relevant
Legal Provision
Section 107(4), CGST Act,
2017:
“The appeal shall be
filed within three months from the date on which the decision or order is
communicated to the person aggrieved…”
This clearly implies that
the period of limitation starts from the date of communication (service),
not from the date on which the order is signed or uploaded.
Submissions
by the Petitioner
Counsel’s
Key Points:
1. Appeal
Within Time: The appeal was filed on 15 July 2024,
which is within 75 days from 30 April 2024 (the claimed date of
receipt).
2. Service
is Crucial: As per Section 107(4), limitation starts only
upon service/communication of the order, not from the date of its
signing or issuance.
3. Violation
of Natural Justice: The petitioner contended that the appellate
authority failed to consider the facts surrounding actual service, thereby
mechanically computing the limitation.
4. Prayer
for Restoration: The petitioner prayed that the dismissal
order be set aside, and the appeal be restored for adjudication on merits,
after a proper examination of service date.
Submissions
by the Respondents
Though initially not
present during hearing, the respondents, represented by the Standing Counsel,
eventually accepted notice. They defended the order on the ground that:
1. Limitation
Started from Date of Order: The appellate authority considered
the date of the Order-in-Original (14 March 2024) as the starting point for
limitation.
2. Appeal
Clearly Late: Since the appeal was filed on 15 July
2024, it was beyond the prescribed limitation, even after considering the
allowable extension under the statute.
However, the department did
not provide any proof or assertion that the order was actually served on
the petitioner on or before 30 April 2024.
Court’s
Analysis and Findings
The Bench made several
critical observations:
1. Failure to Consider
Date of Service
- The Court found that the appellate
authority failed to consider the petitioner’s plea that the order was served
only on 30 April 2024.
- No evidence was placed to disprove
the petitioner’s assertion.
“We find that the
appellate authority has clearly failed to examine the issue of limitation
bearing in mind the aforesaid aspects.”
2. Dismissal Was
Premature
- The appellate authority’s rejection
of the appeal on limitation without applying its mind to the date of
service was found to be unjustified.
“Ends of justice would
merit the order… being set aside with liberty being reserved to the said
authority to examine the issue afresh…”
3. Need for a Factual
Determination
- The question of limitation must be
determined factually and legally, after verifying the actual date
of communication of the order.
4. Writ Petition Allowed
- The Court allowed the writ petition, quashed
the order dated 31 January 2025, and restored the appeal to the
appellate authority for fresh adjudication.
Judgment
The Delhi High Court
passed the following orders:
1. Writ
Petition Allowed: The writ petition was allowed, and the
order of the appellate authority dated 31 January 2025 was quashed.
2. Appeal
Restored: The petitioner’s appeal stands revived on the
appellate authority’s board, who shall now decide afresh on the issue of
limitation after hearing the petitioner.
3. Merits
Left Open: The Court clarified that it had not examined the
merits of the case, and all rights and contentions on the merits remain
open for both parties.
Conclusion
The judgment in CTC
Geotechnical Pvt. Ltd. v. CGST Appeals-I reinforces the principle that procedural
safeguards under GST law are not mere formalities. The court emphasized
that the computation of limitation must align with statutory text—beginning
only from the actual date of communication of the order.
This case serves as a
critical reminder that mechanical rejection of appeals on limitation grounds—without
verifying facts—amounts to denial of justice.
Disclaimer: All the Information is based on the notification, circular and order issued by the Govt. authority and judgement delivered by the court or the authority information is strictly for educational purposes and on the basis of our best understanding of laws & not binding on anyone.
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