ORAL ORDER

(PER : HONOURABLE MS. JUSTICE SONIA GOKANI)

1. This petition is filed under Article 226 of the Constitution of India seeking to challenge the order dated 28.9.2022 passed by Deputy State Tax Commissioner, Appeal -1, Division – 1, Ahmedabad with the following prayers:

8) In view of the above, the Petitioner humbly prays that:-

(A) YOUR LORDSHIPS may be pleased to issue a writ of Mandamus and/or any other appropriate writ, order or direction quashing and setting aside the order dated 28.09.2022 by the Ld. Deputy State Tax Commissioner, Appeal – 1, Division – 1, Ahmedabad under Section 107 of the Gujarat Goods and Services Tax Act, 2017;

(B) YOUR LORSHIP may be pleased to condone the delay caused in preferring the appeal against the order dated 25.03.2022 and restore the Appeal filed- by the Petitioner in Form No. GST APL – 01 dated 17.09.2022 and direct the First Appellate Authority to hear the Appeal on merits of the case;

(C) During pendency and final disposal of this petition, YOUR LORDSHIPS may be pleased to stay the effect, operation and implementation of the order dated 28.09.2022 passed u/s 107 of the Gujarat Goods and Service Tax Act, 2017;

(D) Such other and further relief/s as may be deemed just in the facts and circumstances of the present case may kindly be granted;”

2. This Court had issued notice on 13.10.2022 and learned AGP Ms. Pooja Asher appeared for and on behalf of the State. She has also received the instructions from the concerned officer.

3. It emerges from the record that the return of the petitioner was selected for scrutiny under Section 61 of the Gujarat Goods and Service Tax Act, 2017 (for short “GST Act”). The correctness of the return, the respondent authority had attempted to verify and having found the discrepancy it intimated the same to the petitioner. He was called upon to explain the same. The petitioner could not respond to the discrepancy as the E-mail was sent to his Chartered Accountant and the issuance of notice under Section 61 of the GST Act also was not brought to his notice.

3.1. He, therefore, failed to reply to the notice of 15th July, 2021. The respondent authority therefore, had ascertained the tax payable under Section 73(5) of the GST Act raising a demand of Rs. 72,92,765/- (Ruppess Seventy Two Lakhs Ninety Two Thousand Seven Hundred Sixty Five) and the petitioner continued to remain unaware of these proceedings.

4. The show cause notice was issued by the respondent authority under the FORM GST APL-01 has been shortly paid and sought an explanation. This according to the petitioner is an ex-parte assessment and the demand. Petitioner also was not aware of filing of the appeal before the First Appellate Authority under Section 107 of the GST Act within the time prescribed under the Act. His bank account has been attached on 6.9.2022. The appeal preferred being in the FORM No. APL-01 on 17.9.2022. The petitioner has paid the pre-deposit being 10% of the tax in dispute arising from the order of 22.3.2022. The appellant authority vide order dated 28.9.2022 passed an order rejecting the appeal on the ground that it was preferred beyond the period of limitation. Before his constraint to approach this Court urging this Court to allow him to go first to Appellant Authority and ventilate all his grievances which are very genuine.

“Section 107 (1) Any person aggrieved by any decision or order passed under this Act or the State Goods and Services Tax Act or the Union Territory Goods and Services Tax Act by an adjudicating authority may appeal to such Appellate Authority as may be prescribed within three months from the date on which the said decision or order is communicated to such person.

(4) The Appellate Authority may, if he is satisfied that the appellant was prevented by sufficient cause from presenting the appeal within the aforesaid period of three months or six months, as the case may be, allow it to be presented within a further period of one months.”

5. We notice from the provision that the appellate authority concerned, has the power to condone the delay in presenting the appeal if it had done beyond the period of three months or six months as the case may be and allowed the further period of one month. In the instant case, the period was of 05 months and 22 days in presenting the appeal.

6. This Court in Aggarwal Dyeing and Printing Works v. State of Gujarat [2022] 137, considered the question of cancellation of registration on account of nonspeaking order which the officer concerned had passed, the Court while directing that the department ought to have incorporated specific details to contents of a show cause notice as in prudent person would fail to respond to a show cause notice bereft of details, the Court also having an occasion to consider the issue of limitation to certain extent. It question of delay of more than 02 years, the writ applicant had preferred the appeal before the appellate authority by submitting the FORM GST APL-01 under Section 107 of the Act, 2017 read with Rule 108(1) of the Rules framed there under. He tried to offer the explanation for delay stating that because of the lack of knowledge about filing of returns, more particularly, when the turnover was ‘NIL’ under the bonafide belief that no return is required, he did not submit. He also offered to deposit the amount of tax and penalty and abide by the filing of return and payment of tax in future transactions. The authority declined to exercise its discretion and thereby dismissed the appeal on the ground of delay of 02 years and 17 days. In such circumstances, he approached this Court seeking the reliefs.

7. The Court examined the entire scheme of Act and held that where specific forms have been prescribed at each stage right form registration, cancellation and revocation of cancellation of registration, the same are to be strictly adhered to. At the same time, it is equally important that the Proper Officer empowered under the said Act adheres to the principles of natural justice.

8. The Court also held that the attention of the appellate authority needs to be drawn as it had mechanically disposed of the appeals on the ground of delay. Referring to the decision of Union of India v. Jesus Sales Corporation [1996] 4 SCC 69 observing that the practice has developed holding that even in absence of the provisions providing for an opportunity of hearing, such a provision is required to be read into the Rules governing the case, particularly, when the order being made is likely to have civil consequences. The Apex Court had emphasized on the appellate Court to have the approach tilting in favour of providing fair and reasonable opportunity of hearing while dealing with condonation of delay and filing the appeal.

9. The Court not only had allowed all the writ applications on the ground of violation of principle of nature justice, it also quashed and set aside all show cause notices seeking cancellation of registration with consequential orders and further directed the authority concerned to make an attempt to reduce the hardships and difficulties caused to the dealers on account of the technical bottlenecks or glitches in the GSTN Portal.

10. We notice in this decision which has been pointed out to this Court that the Onset of Pandemic Covid-19 which prevented the further follow up action was the reason for the Court to consider and be lenient in this case. In the instant case also, we notice that the petitioner’s case was selected for scrutiny under Section 61. On having found the discrepancy, the respondent authority had issued the notice intimating the discrepancy and he was called upon to explain the same. Notice in the FORM No. ASMT-10 was issued on e-mail belonging to Chartered Accountant. He therefore, could not respond to the discrepancy. Thus, the notice issued on 15.7.2021 during the time when the Pandemic was on, had never come to the knowledge of the petitioner. The respondent authority in the meantime had ascertained the tax liability raising a demand to the tune of Rs.72,92,765/- and he was also unaware of such proceedings. The notice in FORM No. GST DRC -01 under Section 73 was issued to the petitioner with the show cause notice on 16.2.2022. The petitioner being unaware of the proceedings could not reply to the said notice nor filed any reply and, therefore, the authority concerned, had raised this demand, against which when he approached the appellate authority, it was already 05 months and 22 days beyond the period of 90 days and hence, the authority concerned has not condoned the delay.

11. This Court needs to take a note of the fact that particularly the details which have been furnished by the petitioner are quite glaring and it was a time when the Pandemic was on. We notice in the Hon’ble Supreme Court’s order in this relation in Miscellaneous Application NO.665 of 2021 in SMW(C) No.3 of 2020 dated 23rd September, 2021, the span which had been covered by this is huge and this Court cannot be oblivious of unprecedented circumstances, which existed at the time when this order came to be passed.

12. Our attention is drawn to the fact that the right of appeal beyond the period of 30 days and the issue of limitation while dealing with Section 107 of GST Act is a larger issue which needs to be addressed. Noticing, particularly, the period of Pandemic and the order of the Apex Court in this relation in a given case to be applied to each matter, in our opinion, the appellate authority could have taken into consideration this entire period of Pandemic to condone the delay as the date of knowledge. So far as the case of the petitioner is concerned, the date of knowledge is 6.9.2022 and the bank attachment had been made on 6.9.2022 and he thereafter had approached the authority concerned. If his date of knowledge is taken into consideration, the delay deserves to be condoned.

13. It is apt to know the period of limitation to question the decision of the authority concerned was long over when for the first time the entire aspect had come to the knowledge of the present petitioner on 6.9.2022. It was simply not feasible to prefer the appeal against the order of the respondent authority asked on 15.7.2021. Accordingly, this petition is allowed quashing and setting aside the order dated 28.9.2022 passed by the Deputy State Tax Commissioner, Appeal-1, Division-1, Ahmedabad under Section 107 of the Gujarat Goods and Services Tax Act, 2017. The appeal preferred is restored to the file. Let the First Appellate authority hear the appeal on merits in accordance with law.