Deepak Stores Private Limited Vs Joint Commissioner of Commercial Taxes (Appeals)

FULL TEXT OF THE JUDGMENT/ORDER OF KARNATAKA HIGH COURT

Sri. Shivaprabhu Hiremath, Learned Additional Government Advocate accepts notice for respondents.

2. Heard learned counsel Sri.Sandeep Huilgol for petitioner and learned Additional Government Advocate. Perused the writ petition papers.

3. Though the writ petition is listed for preliminary hearing, with the consent of the learned counsel for the parties, the writ petition is taken up for disposal.

4. Learned counsel for the petitioner would submit that the petitioner is before this Court, questioning Annexure-A/Appellate Order passed under Section 107 of the Karnataka Goods and Services Tax Act, 2017 (for short “2017 Act”). Learned counsel would submit that the petitioner filed an appeal under Section 107 of 2017 Act against the order dated 26.02.2024 which was communicated to the petitioner on 27.02.2024 passed under Section 73(9) and (10) of 2017 Act. Learned counsel would submit that the petitioner had complied the order by depositing 10% of the disputed tax. It is submitted that the appeal against Annexure-B order dated 26.02.2024 was preferred on 30.05.2024 before the first respondent-Joint Commissioner of Commercial Tax (Appeals) and the appeal was filed with 3 days delay. Learned counsel invites attention of this Court to Section 107(1) as well as sub-Section (4) of Section 107 of 2017 Act and contends that the Appellate Authority is given power to condone delay upto 30 days beyond the period of 3 months provided under sub-Section (1) of Section 107 of 2017 Act. Learned counsel would submit that the first respondent-Appellate Authority failed to exercise its discretionary power in proper perspective and rejected his appeal only on the ground that the appeal is not filed within the limitation period i.e., with three months, without examining as to whether the appeal filed is within condonable period and whether case is made out to condone the delay. Thus, learned counsel prays for setting aside the appellate order and for a direction to respondent No.1 to consider the appeal on merit by condoning the delay of 3 days which is condonable under sub-Section (4) of Section 107 of 2017 Act.

5. Per contra, learned Additional Government Advocate would submit that the appeal is admittedly filed with 3 days delay and he submits that there is no proper explanation for the delay. Thus, learned Additional Government Advocate would support the order passed by the first respondent-Appellate Authority.

6. Having heard the learned counsel for the parties and on perusal of the writ petition paper, the only point which falls for consideration is as to whether the first respondent-Appellate Authority has exercised its discretionary power under sub-Section(4) of Section 107 of 2017 Act judiciously?

7. Answer to the above point would be in the negative for the following reasons:

It is not in dispute that the petitioner suffered an order under Section 73(9) and (10) of 2017 Act on 26.02.2024 which was communicated to the petitioner under Annexure-B1 dated 27.02.2024. Section 107 of 2017 Act provides 3 months time to file an appeal against the said order from the date of communication of the order. The petitioner had time to file appeal till 26.05.2024. But the appeal was filed on 30.05.2024. Sub-Section (4) of Section 107 of 2017 Act reads as follows:

“107(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 month.”

The above provision empowers the Appellate Authority, if it is satisfied that the appellant was prevented by sufficient cause from presenting the appeal within the period of three months or six months, allow it to be presented within a further period of one month. In the instant case, though the petitioner has not filed appeal within three months, but has filed within another 3 days, though he had 30 days condonable period. The first respondent-Appellate Authority, only with an observation that statutory appeal is not filed within the limitation period rejected the appeal.

8. A perusal of the impugned order reveals that the first respondent-Appellate Authority failed to exercise its discretionary power under sub-Section (4) of Section 107 of 2017 Act judiciously. Learned counsel for the petitioner submitted that the Managing Director of the petitioner was on travel during the said period. Hence, there was delay of 3 days which was within condonable period. The Appellate Authority failed to consider the reason or cause shown for condoning the delay of 3 days. The appellate authority failed to examine as to delay was within condonable period under Section 107(4) of 2017 Act and whether appellant has shown sufficient cause to condone delay of three days.

9. From the material placed on record, I am satisfied that sufficient cause is shown by the petitioner to condone the delay of 3 days in preferring the appeal which is within condonable period prescribed under sub-Section (4) of Section 107 of 2017 Act.

10. For the reasons stated above, the following order:

(i) The writ petition is allowed.

(ii) Delay of 3 days in preferring the appeal before the first respondent/Appellate Authority under Section 107 of 2017 Act is condoned.

(iii) The first respondent/Appellate Authority is directed to consider the appeal of the petitioner filed on 30.05.2024 against the order dated 26.02.2024 passed under Section 73(9) and (10) of KGST Act on merits and pass appropriate orders.