GSTAT upholds dismissal of appeal for default due to persistent failure to cure defects or appear.
GSTAT upholds dismissal of appeal for default due to persistent failure to cure defects or appear.
Issue
Whether the Goods and Services Tax Appellate Tribunal (GSTAT) is justified in dismissing an appeal for default under Rule 42 without examining the merits when the appellant persistently fails to cure defects and fails to appear despite multiple opportunities.
Facts
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The assessee filed an appeal before the GSTAT against an Order-in-Appeal concerning non-payment of late fees and ineligible input tax credit.
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The First Appellate Authority had previously dismissed the appeal due to delay after issuing a deficiency memo.
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The GSTAT Registry issued a defect memo identifying four specific defects: non-uploading of the Show Cause Notice (SCN), an illegible Order-in-Original (OIO), deficit court fees, and missing respondent particulars.
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The Registry granted three separate hearings and explained the statutory requirement to cure defects within the prescribed timeframe, but the appellant took no steps to cure them.
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Upon scrutiny escalation, the matter was placed before the Bench under Rule 24.
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The Bench afforded three additional dates for personal appearance, but no representative or communication was received from the appellant.
Decision
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Persistent non-compliance and repeated non-appearance despite multiple opportunities evidenced a clear lack of interest on the part of the appellant to prosecute the appeal.
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Rule 42 permits dismissal for default when an appellant fails to appear at the scheduled hearing, supported by inherent powers under Rule 10 to secure justice and prevent abuse of process.
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Since sufficient time and indulgence had been extended to the appellant, no further opportunity was warranted.
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The appeal was dismissed for want of prosecution without examining the underlying merits of the case (ruled in favor of the Revenue).
Key Takeaways
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Duty to Prosecute: Litigants must actively pursue their appeals; persistent inaction or failure to cure defect memos issued by the Registry can lead to summary dismissal.
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Scope of Rule 42 & Rule 10: The Tribunal possesses express procedural powers under Rule 42 and inherent powers under Rule 10 to dismiss an appeal for default to prevent procedural abuse and judicial backlog.
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Preclusion of Merits Review: When an appeal is dismissed for want of prosecution, the Appellate Tribunal will not evaluate the substantive legal or factual merits of the underlying dispute.
GOODS AND SERVICE TAX APPELLATE AUTHORITY , HYDERABAD
Shakti Industrial House
v.
Joint Commissioner (Appeals-II)*
Sushil Kumar Sharma, Judicial Member
and Duvvuri Krishna Srinivas, Technical Member
and Duvvuri Krishna Srinivas, Technical Member
Filing No. 2026056101000148
SEPTEMBER 2, 2026
PVV Satyanarayana and Suresh for the Respondent.
ORDER
Duvvuri Krishna Srinivas, Technical Member.- From the records it was observed that M/s Shakti Industrial House filed this appeal APL/DD35/HYD/2026 against OIA No. HYD-GST-SC-AP2-349-2023-24, Dated 31.01.2024, and the same is listed with defects no.2026056/10100/0148. The issues involved are non-payment of late fee and claiming of ineligible Input Tax Credit.
2. From the records, it is seen that, a defect Memo was issued by the Registry listing out four defects which includes, non-uploading of SCN concerned, legible copies of OIO concerned, non-payment of full court fee as prescribed, non-furnishing basic details like Respondent etc.
3. Further, it was observed that First Appellate Authority has dismissed the appeal filed by the Appellant, after issuing deficiency memo, for delayed filing of the appeal.
4. Registry has given three hearings on 27.04.2026, 13.05.2026 and 02.06.2026. On the first day of hearing, i.e. on 27.04.2026, Shri Pradeep Kumar Jain, CS of the Appellant company was present and Registry has explained the defects and the need for curing the same within the prescribed time.
5. It appears that the Appellant has not taken any steps to cure the defects pointed out by the Registry afterwards.
6. Rule 24 of GST Procedure Rules, 2026 requires defective appeal to undergo scrutiny and permits escalation to the Registrar and placing the appeal before the appropriate Bench, where the notified defects remain unrectified. Accordingly, the matter was placed before this Bench for directions.
7. Following principles of natural justice, the Bench has given three chances for appearance to the Appellant on 15.07.2026, 29.07.2026 and 02.09.2026. Neither the Appellant nor his Counsel were present on all the three occasions. As seen from the records, no communication from the appellant was received in this regard, as on today.
8. Rule 10 of GSTAT Procedure Rules, 2025 preserves the Tribunal’s inherent powers to make orders necessary to secure justice or prevent abuse of process of law.
9. Further, Rule 42 of GSTAT Procedure Rules, 2025 states that “where on the day fixed for the hearing of the appeal or on any other day to which such hearing may be adjourned, the appellant does not appear when the appeal is called on for hearing, the Appellate Tribunal may, in its discretion, either dismiss the appeal for default or hear and decide it on merits”.
10. As stated above, the Appellant has not rectified the defects pointed out earlier three times by the Registry and three times by the Bench, which shows lack of interest on the part of the Appellant to proceed with this appeal.
11. Sufficient time has been given to the Appellant; no further time can be granted.
12. Accordingly, the appeal is dismissed for want of prosecution without examining the merits.
13. The Appellant is at liberty to request for restoration as prescribed under Proviso to Rule 42 within reasonable time.