Case Title | Rana Engineering vs Union of India |
Court | Jharkhand High Court |
Honorable Judges | JUSTICE ARUN KUMAR RAI |
Citation | 2024 (02) GSTPanacea 25 HC Jharkhand WP(T) No. 6387 of 2023 |
Judgment Date | 23-February-2024 |
Mr. Rana Engineering finds itself in a state of dissatisfaction following the dismissal of their appeal case, numbered 126/CGST/RAN/2023, by an order issued on September 8, 2023. This ruling, delivered by the Additional Commissioner of Central Taxes (Appeals), deems the appeal as not maintainable and subject to a limitation bar. Additionally, the appellate authority concludes that the benefits afforded by the Amnesty Scheme, active until August 31, 2023, cannot be extended to the petitioner-firm due to the fact that the cancellation order for their registration was issued after December 31, 2022.
The petitioner-firm, operating under the registration number GSTIN No. 20AMCPR4953K1ZY and registered under the Goods and Services Tax (GST) law, had failed to file returns for a consecutive period exceeding six months. Consequently, a show-cause notice was served upon them on December 9, 2022. Subsequently, upon finding the explanation provided by the petitioner-firm unsatisfactory, their GST registration was revoked via an order dated February 3, 2023, with the revocation set to take effect from January 31, 2023. In response to this action, the petitioner-firm pursued an appeal under section 107 of the GST Act, only to have it dismissed as mentioned earlier.
The dismissal of the appeal has left Mr. Rana Engineering disheartened, particularly due to the denial of benefits under the Amnesty Scheme and the determination that the appeal was time-barred.
Section 39 of the GST Act mandates that every registered person, except for an input service distributor or a non-resident taxable person, must submit a return of inward and outward supply of goods and services for each calendar month. This section outlines various requirements and stipulations that registered individuals or firms must adhere to. Additionally, Section 45 of the GST Act allows registered entities to restore their registration by submitting a final return within three months from the cancellation date or the date of the cancellation order, whichever is later. Furthermore, under Section 30, a registered person whose registration has been cancelled can apply for its revocation following the prescribed procedure.
In a legal case, Mr. Shresth Gautam, representing the petitioner-firm, referenced a registration advisory issued in November 2023, which extended the period for filing a revocation application to 270 days. However, the petitioner-firm failed to utilize the opportunities provided under Section 30 or Section 45 to restore its registration. Instead, it directly appealed to the appellate authority under Section 107 of the GST Act.
Examining Section 107, it becomes evident that under specific conditions outlined in subsections 3 and 4, the appellate authority may extend the three-month period by an additional three months, and then by one more month. Thus, in certain circumstances, an appeal under Section 107 can be filed within a total period of seven months. Consequently, the delay in the petitioner-firm’s appeal, filed on 26th August 2023, which fell within seven months from the date of the cancellation order, should have been permissible and not dismissed on grounds of delay.
Moreover, the court suggests that the appellate authority could have alternatively granted the petitioner-firm an opportunity to pursue revocation of the cancellation of its license under Section 30, upon payment of applicable penalties, fines, and interest. It’s noted that Section 14 of the Limitation Act, 1963, which provides for the exclusion of time spent in prosecuting a matter in the wrong forum, applies here. The court acknowledges that the Limitation Act is not excluded in the GST Act, thus allowing the petitioner-firm to benefit from Section 14 if necessary.
In the given scenario, a previous order dated 8th September 2023 is being challenged and set aside. The writ petition filed is being granted to some extent, specifically allowing the petitioner firm to submit an application under section 30 within 30 days after fulfilling all necessary formalities. The court has decreed that this application should be processed and handled in compliance with the appropriate legal procedures.
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