Madras High Court Condoned 291-Day Delay in Filing GST Appeal Due to Unawareness

The Madras High Court has condoned a 291-day delay in filing an appeal under the Goods and Services Tax (GST) Act, holding that unawareness of the uploaded assessment order on the GST portal constituted a “genuine cause.”

The petitioner, M/s Annai Medicals, had approached the Court challenging the rejection of their appeal solely on the ground of limitation. The petitioner argued that though a show cause notice was issued on February 24, 2023, and a detailed reply along with supporting documents was filed, the assessment order was passed on June 27, 2023, without consideration of their submissions.

However, since the order was merely uploaded on the GST common portal and not physically communicated or otherwise brought to the petitioner’s notice, they remained unaware of it. As a result, the appeal was filed only on August 13, 2024, after a delay of 291 days.

The appellate authority rejected the appeal on October 15, 2024, citing that the delay exceeded the condonable limit. The petitioner challenged this rejection before the High Court, stating that the delay was neither deliberate nor wanton but due to the absence of effective communication of the order.

Justice Krishnan Ramasamy, after considering the facts and hearing both sides, held that the petitioner’s explanation was genuine. As the petitioner had already deposited the statutory 10% of the disputed tax at the time of filing the appeal, the Court directed the petitioner to make an additional 10% deposit due to the lengthy delay. Post-compliance with the same by the petitioner, the appellate authority was instructed to admit the appeal and decide it on merits after granting the petitioner an adequate opportunity of hearing.

This ruling highlights the importance of effective communication in tax matters and the need for authorities to ensure that taxpayers are adequately informed about important decisions that affect their rights and obligations. It also underscores the Court’s willingness to consider genuine reasons for delays, provided taxpayers take steps to rectify the situation promptly.