Appeal Directed to Be Heard on Merits as Delay in Filing Was Condoned Due to Improper Service of Order

By | August 28, 2026
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Appeal Directed to Be Heard on Merits as Delay in Filing Was Condoned Due to Improper Service of Order
Issue
Whether an appeal under Section 107 of the CGST/RGST Act should be entertained on merits by condoning the delay when the Order-in-Original was served solely by uploading it on the GST portal under “Additional Notices and Orders” without manual service, causing the taxpayer to remain unaware of the order.
Facts
  • Assessment Period: Financial Year 2021-22.
  • Impugned Order: An Order-in-Original was passed against the petitioner-assessee raising a GST demand on grounds of alleged non-payment of tax and excess Input Tax Credit (ITC) availment.
  • Mode of Service: The order was only uploaded on the GST portal under the “Additional Notices and Orders” tab and was not served manually upon the petitioner.
  • Lack of Direct Knowledge: The portal contact credentials reflected the details of the petitioner’s consultant, resulting in the petitioner remaining unaware of the issuance of the order.
  • Blocking of Appeal: Due to the passage of time, the electronic filing window for the statutory appeal on the portal was blocked as time-barred.
  • Relief Sought: The petitioner filed a writ petition seeking condonation of the delay and a direction to the Appellate Authority to hear the statutory appeal on its merits.
Decision
  • Prejudice Over Procedural Rigor: While the Appellate Authority is ordinarily bound by the statutory limitation prescribed under Section 107, non-adjudication of the appeal on merits would cause grave prejudice to the taxpayer.
  • Uncontrollable Circumstances: The delay in filing the appeal was caused by circumstances beyond the petitioner’s control due to the mode of service and lack of actual knowledge.
  • Condonation Granted: Applying a consistent judicial approach to enable decisions on merits, the delay in filing the appeal was condoned.
  • Direction Issued: The Appellate Authority was directed to entertain the statutory appeal and decide the matter on its merits. Held in favour of the assessee.
Key Takeaways
  • Constructive vs. Actual Notice: Serving orders exclusively under obscure tabs on the GST portal (like “Additional Notices and Orders”) without manual or direct communication can constitute a valid ground to seek relief against limitation bars.
  • Preference for Adjudication on Merits: Courts prefer substantive justice over procedural technicalities, especially where delay stems from communication breakdowns rather than deliberate negligence.
  • Writ Jurisdiction for Limitation Relief: Where the statutory Appellate Authority lacks inherent power under Section 107 to condone delay beyond the prescribed extension period, High Courts can exercise writ jurisdiction to direct hearing on merits in genuine cases.
HIGH COURT OF RAJASTHAN
Rythm
v.
State of Rajasthan
Arun Monga and Ashutosh Kumar, JJ.
D.B. Civil Writ Petition No. 15450 of 2026
AUGUST  13, 2026
Ravi Gupta, Harsh Ladha and Ms. Preeti Katta for the Petitioner. Ms. Mahi Yadav, AAG, Ms. Chelsi Agarwal, AAAG and Khem Chand Sharma, UOI for the Respondent.
ORDER
Arun Monga, J. – The petitioner herein, inter alia, seeks quashing and setting aside of the impugned Order-in-Original dated 09.12.2025, passed by the Joint Commissioner, State Tax, Circle-G, Zone-III, Jaipur, and also seeks a direction commanding respondents to release the hold/lien placed on the petitioner’s bank account and to restore the amounts recovered from the Electronic Credit Ledger.
1.1 Impugned Order-in-Original dated 09.12.2025, vide which GST demand of Rs.41,57,287/- was raised for financial year 2021-2022 on account of non-payment of tax for the relevant year and thereafter claiming excess of Input Tax Credit by the petitioner. The appeal against the said order could not per force be filed before the Appellate Authority as the online status of the appeal would reveal that the same is time-barred. The petitioner is thus left remediless. Aggrieved by the same, petitioner filed the instant writ petition on 04.08.2026.
2. Learned counsel for the petitioner submits that the delay in filing the appeal occurred due to bona fide circumstances. The delay is thus occasioned by genuine and sufficient cause, and not due to any negligence or lack of diligence on the part of the petitioner.
2.1 It was further submitted that the petitioner remained unaware of the passing of the impugned order dated 09.12.2025 as the same was uploaded on the GST portal under the head “Additional Notices and Orders” instead of “Notices and Orders”. Further, at the relevant time, the e-mail address and mobile number of the petitioner’s tax consultant were registered on the GST portal, who did not inform the petitioner about the impugned proceedings. The impugned order was never served upon the petitioner manually or in hard copy. Thereafter, the respondent department initiated recovery proceedings by first appropriating the balance available in the petitioner’s Electronic Credit Ledger and, thereafter on 16.07.2026, issued Form GST DRC-13 under Section 79(1)(c) of the CGST/RGST Act, 2017 to the petitioner’s banker, directing the Bank to remit alleged outstanding amount of Rs.41,13,811/- to the government and to furnish details of all other bank accounts linked with the petitioner’s PAN. Consequently, the Bank marked a hold/lien on the petitioner’s bank account. The petitioner came to know about the recovery proceedings only when a banking transaction failed on account of the hold/lien marked on the bank account. Thereafter, on 28.07.2026, the respondent department further recovered outstanding demand amount by utilizing the balance available in the petitioner’s Electronic Cash Ledger.
2.2 Owing to these circumstances, the petitioner could not take necessary steps within the prescribed period. The delay was neither intentional nor due to any negligence. The impugned order has been passed in complete violation of the mandatory provisions of Section 75(4) of the CGST/RGST Act, 2017 and the principles of natural justice, as no opportunity of personal hearing was ever granted to the petitioner. The petitioner acquired knowledge of the impugned order, whereafter immediate steps were taken to challenge the same. However, by then, the appeal had become time-barred on the GST Portal.
3. In the aforesaid backdrop, we have heard the learned counsels for the parties and perused the record.
4. Learned Counsel for the petitioner, relying on the various Division Bench judgments of this very Court in M R Traders v. UOI 2026 SCC OnLine RAJ 2115, Molana Construction Company v. Central GST Department, Rajasthan [2024]  89 GSTL 353 (Rajasthan)/2024 SCC OnLine Raj 3938 , Man Singh Tanwar v. Commissioner, Central GST Department, Rajasthan  106 GST 181 (Rajasthan)/D.B. CWP 14658/2024, RPC PSIPL JV v. State of Rajasthan [D.B. Civil Writ Petition No. 7260 of 2025, dated 2-7-2025] and RPC PSIPL JV v. State of Rajasthan [D.B. CWP No. 11794 of 2025, dated 12-8-2025] argues that sufficient cause of delay in filing the appeal due to circumstances beyond control has been shown and thus appeal be directed to be considered on merits after condoning the delay by this Court.
5. Learned counsels for the respondents oppose the above submission and contends that the impugned order has rightly been passed and appeal is now barred by limitation.
6. Having heard, as above, it transpires that while it is true that the Appellate Authority is bound by the statutory provisions of limitation provided under Section 107 of the RGST/CGST Act, 2017, however, considering the reasons owing to which the petitioner could not submit its appeal within the stipulated time, being beyond its control, non-adjudication of appeal on merits would cause grave injury and prejudice to the petitioner.
7. In the judgments cited above, this Court, while allowing the writ petitions, have issued directions to entertain the appeal on merits.
8. Aside above, our attention has been gone to a Division Bench Judgment rendered by Punjab and Haryana High Court in case titled as Luxmi Traders v. Union Territory of Chandigarh  (Punjab & Haryana)/(2026:PHHC099329:DB) in CWP No. 27139/2025, wherein based on elaborate discussion and deliberations thereof, following view has been taken.
“60. On the basis of discussions and deliberations aforesaid, we come to the following conclusions:-
(i) Service of SCN upon the petitioner/assessee concerned cannot be deemed sufficient merely on account of its uploading on the Common Portal, unless its receipt is acknowledged or a reply is filed.
(ii) Where SCN is served only by way of uploading it on the Common Portal and in the absence of reply filed by the petitioner/assessee concerned, ex parte order is passed in original, the proceedings would stand restored to the stage of issuance of SCN and the petitioner would be at liberty to file reply to the SCN within a period of four weeks from today whereafter, the Department shall proceed further after affording required opportunity of hearing.
(iii) In cases where the order-in-original is passed after contest, and is served only by uploading it on the Common Portal, the period of limitation for filing of appeal would not be triggered, and the assessee aggrieved will have the right to file an appeal within a period of four weeks from today.
(iv) Where appeals filed against the order-in-original, which was served only by uploading it on the Common Portal are dismissed on the ground of limitation, the order of the Appellate Court shall be set aside and the appeal would stand restored to its original number, and would be heard and decided on merits.
(v) In cases where SCNs were served only on portal and ex parte adjudication order was passed for want of reply of assessee and appeal against the said order was dismissed on the ground of delay, both adjudication order and order-in-appeal shall be set aside and proceedings will be restored at the stage of issuance of SCN and petitioner/assessee shall be at liberty to file reply to SCN within four weeks from today, whereafter, the department shall proceed further after affording due opportunity of hearing.”
9. Having given out thoughtful consideration to the aforesaid view expressed by the Punjab and Haryana High Court, we are in respectful agreement therewith and accordingly, see no reason why the benefit be not accorded to the petitioner therein.
10. In the premise, following the consistent view as already taken by this Court, ibid, we allow the present writ petition to the extent of condoning the delay in filing of the appeal by the petitioner.
11. Accordingly, the Appellate Authority shall now entertain the appeal of the petitioner and adjudicate the same on merits, provided the same is filed within 30 days of the instant order being uploaded on the website of this court.
12. All pending applications, if any, stand disposed of.