Time-Barred Appeal Under Section 107 Cannot Be Revived Through Writ Petition.

Time-Barred Appeal Under Section 107 Cannot Be Revived Through Writ Petition.

Issue

Can a High Court, in its writ jurisdiction, entertain a challenge to a GST order when the assessee has failed to file a statutory appeal within the absolute limitation period prescribed under Section 107 of the CGST Act?

Facts

• The GST authorities passed an order to withhold the assessee’s IGST refund.
• The assessee had actively participated in the adjudication proceedings that led to this order.
• The assessee failed to file an appeal against the refund-withholding order within the statutory limitation period of three months (plus a condonable period of one month).
• After the appeal period expired, the assessee filed a writ petition in the Delhi High Court, arguing, among other things, that the order was illegible.
• The department sought to adjust the withheld refund against a demand raised on the assessee for fraudulent availment of Input Tax Credit (ITC).

Decision

• The Delhi High Court dismissed the writ petition, holding that it was not maintainable.
• It ruled that the limitation period under Section 107 of the CGST Act is absolute and cannot be condoned beyond the statutory maximum of four months.
• The court clarified that writ remedies cannot be used as a tool to bypass the specific appellate mechanism and its strict timelines provided under the GST law.
• The argument of the order being illegible was rejected, with the court stating that the onus was on the assessee to proactively obtain a legible copy from the department in a timely manner.
• The court directed that the withheld refund be adjusted against the outstanding demand related to fraudulent ITC.

Key Takeaways

• Statutory Timelines are Absolute: The time limit for filing an appeal under Section 107 (three months, extendable by one month) is a hard deadline. Appellate authorities and courts have no power to condone delays beyond this period.
• Writ Petitions Cannot Circumvent Statutory Appeals: A High Court will generally not entertain a writ petition when an assessee has neglected to use an available and effective statutory remedy, such as an appeal, within the prescribed time.
• Onus is on the Assessee: The responsibility lies with the taxpayer to be diligent. If a document is unclear, the onus is on them to seek a clear copy from the authorities; inaction cannot be used later as an excuse for missing deadlines.
• Participation in Proceedings Matters: If an assessee has participated in the original proceedings, it becomes difficult for them to later claim a violation of the principles of natural justice.