GST Appeal Can’t Be Dismissed for Minor Delay if Pre-Deposit Paid: Madras High Court

Case Name: Tvl. Chennais Pet Vs State Tax Officer
Appeal No.: W.P.(MD) No. 3995 of 2025
Judgment Date: 14/02/2025
Court: Madras High Court

The Madras High Court, in a progressive and taxpayer-friendly judgment, held that a minor procedural delay in filing a GST appeal cannot be the sole ground for dismissal, especially when the assessee has complied with statutory requirements, including pre-deposit of the disputed tax.

Background of the Case

The petitioner, Tvl. Chennais Pet, had delayed filing their GST appeal by 35 days. The delay occurred because the assessment notice was uploaded in the “additional notices” section of the GST portal, which the petitioner’s consultant failed to notice. Upon realizing the order when their bank account was attached, the petitioner immediately filed the appeal with a delay condonation petition and had already deposited the mandatory pre-deposit under Section 107(6) of the CGST Act.

Despite this, the appellate authority rejected the appeal on grounds that it was filed beyond the condonable period by just five days.

Court’s Observations

• The court acknowledged the strict procedural adherence by the tax authorities but emphasized that substantive justice must prevail.
• The petitioner had not only made the 10% pre-deposit, but also paid an additional 15% of the disputed tax amount, totaling 25% of the demand, showcasing genuine intent to comply.
• It observed that procedural lapses must not defeat justice when statutory obligations are met and there is no mala fide intent.

Judgment

• The Court set aside the appellate rejection order dated 03.01.2025.
• Directed the appellate authority to reconsider the appeal on merits and dispose of it within two months.
• Held that minor procedural delay should not obstruct justice when there is substantial compliance.

Significance of the Judgment

This ruling underscores that justice should not be denied for mere technical reasons, especially in taxation where procedural errors are common due to digital complexities.

The decision is a valuable precedent affirming that statutory compliance (like pre-deposit), good faith actions, and reasonable delays must be considered sympathetically by tax authorities and appellate bodies.

Prepared by: Dr. Muhammed Mustafa C T
BRQ Associates - Tax & Legal Research Team
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