Appeal Filed Within Amnesty Window Cannot Be Rejected for Delay or Curable Deficiency in Pre-Deposit

1. The Core Dispute: Amnesty Scheme vs. Statutory Timeline

The petitioner, a registered works contractor, failed to file an appeal within the normal statutory period against an assessment order. However, on November 2, 2023, the CBIC issued Notification No. 53/2023 (Ext. P5), which granted an extended window until January 31, 2024, to file appeals for orders passed on or before March 31, 2023.

The Fact: The petitioner filed the appeal on November 28, 2023, well within the amnesty window.
The Rejection: The Appellate Authority rejected the appeal solely on the grounds of delay and a deficiency in the pre-deposit (the petitioner paid the standard 10% instead of the amnesty-mandated 12.5%).

2. Legal Analysis: Substantive Justice vs. Technical Lapses

The High Court examined whether a taxpayer’s failure to explicitly mention a notification or a minor deficit in payment should result in the loss of a statutory remedy.

I. Validity of Filing within the Amnesty Window

The court held that when a special order like Notification 53/2023 permits filing beyond the usual timeline, an appeal submitted within that specific window cannot be rejected for delay.

Awareness of Law: The Appellate Authority is presumed to be aware of the prevailing special notifications. The failure of a taxpayer to “expressly invoke” the amnesty scheme in the appeal is not a fatal error, as the notification did not mandate such a specific mention.

II. Deficiency in Pre-Deposit is a “Curable Defect”

Under the amnesty scheme, the pre-deposit requirement was increased from 10% to 12.5% (with at least 2.5% paid from the Electronic Cash Ledger).

The Ruling: Paying 10% instead of 12.5% is a curable defect. In the interest of fairness, the Appellate Authority ought to have issued a Deficiency Intimation (allowing the petitioner to pay the balance) rather than dismissing the appeal outright.

3. Final Verdict: Restoration for Decision on Merits

The Court emphasized that tax authorities should adopt a “wider application” of amnesty schemes to ensure the legislative intent—providing relief to aggrieved parties—is not defeated by hyper-technicalities.

Verdict: The rejection order (Ext. P4) was quashed.
Direction: The appeal was restored. The Appellate Authority was directed to hear the case on its merits, provided the petitioner proved full compliance with the amnesty conditions (paying the balance 2.5% to reach the 12.5% pre-deposit).

Key Takeaways for Taxpayers

Amnesty Protection: If a special notification (like an amnesty or extension) exists, use it even if you have already missed the normal 120-day limit.
Deficiency Memos: If you have paid a short pre-deposit, the department should ideally issue a Deficiency Memo (GST APL-02) before rejecting the appeal.
Cash Ledger Requirement: For amnesty-based appeals, ensure that the additional 2.5% pre-deposit is specifically paid through the Electronic Cash Ledger to satisfy the scheme’s conditions.

HIGH COURT OF KERALA

Aboobaker.P.P

Joint Commissioner, State Goods And Services Tax Department^*

ZIYAD RAHMAN A.A., J.

WP(C) NO. 40639 OF 2025

NOVEMBER 28, 2025

Hrithwik D. Namboothiri and P.N.Damodaran Namboodiri, Advs. for the Petitioner. Smt. Reshmitha R Chandran, Sr. GP for the Respondent.

JUDGMENT

1. The petitioner is a registered contractor and is a taxpayer under the provisions of the KGST/CGST Act, 2017. The dispute highlighted in this case pertains to the assessment for the year 2021-2022. Ext.P2 is the order of assessment passed in respect of the said assessment on 01.09.2022. As per Section 107 of the CGST Act, the petitioner ought to have filed the appeal within three months from date of communication of the said order and he could have got the delay condoned upon furnishing sufficient reason, upto a further period of one month. However, the petitioner could not submit the appeal within the statutory period.

2. In the meantime, Ext.P5 notification was issued by the Central Board of Indirect Taxes and Customs on 02.11.2023, by which the period for filing the appeals was extended up to 31.01.2024. In such circumstances, the petitioner submitted an appeal on 28.11.2023 before the first appellate authority. However, the petitioner paid 10% of tax as pre-deposit, but the same was rejected by the first appellate authority as per Ext.P4 intimation. The reason for rejection shown in Ext.P4 was the delay in submission of the appeal. This writ petition is submitted by the petitioner in such circumstances, challenging Ext.P4 and also seeking a direction to the 2^nd respondent the appellate authority, to restore the petitioner’s appeal and to dispose of the same on merits.

3. I have heard Sri.P.N. Damodaran Namboothiri, learned Counsel for the petitioner and Smt.Reshmitha R. Chandran, learned Government Pleader for the respondents.

4. When the learned Counsel for the petitioner places reliance upon Ext.P5 to contend that, as per the same, the period for filing the appeal stood extended up to 31.01.2024 and the petitioner submitted the appeal on 28.11.2023, the learned Government Pleader points out that, as far as the extension of time for filing the appeal as contemplated in Ext.P5 is concerned, the same was subject to conditions, which are specifically mentioned in Clause 3 of Ext.P5, which reads as follows:

“3. No appeal shall be filed under this notification, unless the appellant has paid-

“(a) in full, such part of the amount of tax, interest, fine, fee and penalty arising from the impugned order, as is admitted by him; and

(b) a sum equal to twelve and a half per cent. of the remaining amount of tax in dispute arising from the said order, subject to a maximum of twenty-five crore rupees, in relation to which the appeal has been filed, out of which at least twenty percent should have been paid by debiting from the Electronic Cash Ledger.”

It was pointed out that, the petitioner failed to make the necessary pre-deposit as contemplated in the above provision and therefore, the appellate authority was not having any other option than to reject the same.

5. After considering all the relevant aspects, I find some merits in the submission made by the learned Counsel for the petitioner. Of course it is true that, the petitioner did not comply with the condition of pre-deposit as contemplated as per Ext.P5 for entertaining an appeal beyond the statutory time limit specified under Section 107 of the CGST Act. However, it is a fact that, the petitioner had submitted the appeal after Ext.P5 was notified and within the time limit stipulated therein. As far as the noncompliance of the condition of pre-deposit as per Ext P5 is concerned, it was a curable defect, and the appellate authority ought to have intimated the petitioner about his defect, so as to enable him to cure the defect and re-present the appeal. Instead, despite the fact that the appeal was submitted on 28.11.2023, Ext.P4 intimation rejecting the appeal was issued to the petitioner only on 22.09.2025.

6. In this regard, the learned Government Pleader would point out that, since Ext.P5 contemplates a special scheme for entertaining the appeal beyond the statutory time limit under the Act, it was the obligation of the petitioner to fulfill all the conditions before filing the appeal, to avail the benefits thereof. It was further contended by the learned Government Pleader that, as far as the appellate authority is concerned, it may not be possible for the said authority to treat the appeal as the one submitted seeking the benefit of Ext.P5, if the same is not specifically mentioned in the appeal itself or the the special conditions contemplated under Ext.P5 are complied with.

7. Even though I find that, there may be certain practical difficulties for the appellate authority to identify the appeal as the one submitted seeking the benefit of Ext.P5, in the absence of special mention of the same in the appeal, that by itself cannot be a reason to reject the appeal on the ground of delay as such. It is a fact that, when the appeal was submitted, Ext.P5 order was already notified and it was in force. The appellate authority was aware of the special circumstances under which an appeal could be filed beyond the statutory time limit. Moreover, in Ext.P5, nowhere it is mentioned that, any special mention is to be made in the appeal, to seek the benefit of extended time as per Ext.P5. Therefore, the fact that the petitioner did not mention anything about the availing of the benefit as per Ext.P5, in the appeal, cannot be a ground to treat it as ordinary appeal submitted beyond the time limit under the relevant statutory provision. As far as the non-compliance of the condition of pre-deposit is concerned, I have already found that, it was only a curable defect and the said defect was never pointed out to the petitioner before issuing Ext.P4 intimation.

8. It is also to be noted in this regard that, as far as the statutory time limit contemplated under Section 107 of the CGST Act is concerned, once the aggrieved party fails to follow the timeline stipulated therein, the said remedy as such would be foreclosed. Therefore, when a scheme is introduced by the competent authority for extension of the time limit subject to compliance with the some conditions, the attempt of the authorities must be to ensure that, a wider application of the same is adopted so as to enable the aggrieved party to avail the benefit to the maximum possible. Here in this case, it is a fact that the petitioner has submitted the appeal in time and the only defect was that he failed to comply with pre-deposit at the rate as contemplated in scheme Ext.P5 (12.5%) and the pre-deposit made by the petitioner was 10%, which is as per the statute contemplated. Now the petitioner had already deposited the additional amount payable to comply with the special condition imposed in Ext.P5 and an acknowledgment in this regard is already produced as Ext.P6. In such circumstances, I am of the view that, this is a fit case in which an interference can be made invoking the powers of this Court under Article 226 of Constitution of India so as to enable the petitioner to have his appeal considered on merits.

In such circumstances, this writ petition is disposed of quashing Ext.P4, with a direction to the 2^nd respondent to restore Ext.P3 appeal, after ensuring that the petitioner complied with all the conditions imposed as per Ext.P5. In case there are any shortcomings in complying with the condition, it shall be open to the appellate authority to issue an intimation in this regard and upon receipt of the same, such defect shall be cured by the petitioner. If the appeal is in order and the petitioner has satisfied the conditions in Ext.P5, the appeal shall be considered on merits and appropriate orders thereon shall be passed after giving the petitioner an opportunity for being heard.