MADRAS HC DIRECT APPELLATE AUTHORITY TO CONSIDER BELATED GST APPEAL DUE TO ILLNESS ON MERITS

Great Heights Developers LLP Vs Additional Commissioner (Madras high court)

Introduction: The case of Great Heights Developers LLP Vs Additional Commissioner before the Madras High Court revolves around the belated filing of an appeal due to the petitioner’s illness. The petitioner challenges the imposition of penalty and interest under the Central Goods and Services Tax Act, 2017. The Madras High Court’s directive regarding the consideration of the appeal despite the delay sheds light on the legal treatment of appeals in such circumstances.

Detailed Analysis: The petitioner, facing penalties under Sections 73(9) and 73(7) of the CGST Act, sought to challenge the assessment order. However, due to the petitioner’s diagnosis of septic shock and subsequent medical complications, the appeal could not be filed within the stipulated timeframe. The Madras High Court noted that while the Appellate Authority typically cannot condone delays beyond 120 days, the petitioner’s delay of only 24 days, coupled with valid medical reasons, warranted consideration.

Crucially, the court highlighted that the petitioner had fulfilled its tax liabilities, with the appeal focusing solely on penalty and interest. Recognizing the petitioner’s genuine reasons for the delay and the limited scope of the appeal, the Madras High Court directed the Appellate Authority to receive and adjudicate the appeal on its merits within a specified timeframe.

This decision underscores the judiciary’s sensitivity to genuine hardships faced by taxpayers and the need for equitable treatment in such cases. By directing the Appellate Authority to consider the appeal despite the delay, the court upholds the principle of natural justice and ensures that legal remedies remain accessible even in challenging circumstances.

Conclusion: The directive by the Madras High Court in Great Heights Developers LLP Vs Additional Commissioner highlights the importance of considering extenuating circumstances in appeals related to tax matters. By allowing the appeal to proceed despite the petitioner’s illness-related delay, the court promotes fairness and ensures that individuals are not unduly disadvantaged due to unforeseen events. This decision serves as a reminder of the judiciary’s commitment to upholding justice and protecting the rights of taxpayers, even in the face of procedural constraints.

FULL TEXT OF THE JUDGMENT/ORDER OF MADRAS HIGH COURT

The petitioner challenges order in original dated 14.08.2023 insofar as the imposition of penalty and interest under Section 73(9) and Section 73(7) of the Central Goods and Services Tax Act, 2017 (the CGST Act) are concerned. The petitioner states that pursuant to how cause notice, the impugned assessment order was issued on 14.08.2023. Such order was received by the petitioner on 16.08.2023. Accordingly, the appeal should have been filed within 90 days thereof. It is further stated that the appeal could not be filed in time both on account of the petitioner being diagnosed with septic shock and on account of the consequential difficulties in following up with the consultant. As a result, it is stated that the time limits for filing an appeal with an application to condone delay expired on 16.12.2023.

2. Under Section 107 of the CGST Act, the Appellate Authority does not have the power to condone delay beyond 120 days. In this case, the period of further delay is only 24 days and the petitioner has provided cogent reasons to explain such delay. It is pertinent to note that the petitioner has paid the entire tax liability and the proposed appeal is limited to penalty and interest.

3. Therefore, the Appellate Authority is directed to receive and dispose of the appeal on merits if the appeal is received within a maximum period of ten days from the date of receipt of a copy of this order.

4. P.No.1324 of 2024 is disposed of on the above terms. No costs. Consequently, W.M.P.No.1358 of 2024 is closed.