Extension of Time Granted for Appeal Following Full Tax Payment.
An assessee, despite having a valid legal right to appeal, was granted additional time to file an appeal against an order confirming a tax demand, a penalty, and interest, as the entire tax amount had already been paid, and there was no violation of natural justice.
Issue
Whether an assessee who has already paid the full disputed tax amount can be granted additional time to file a statutory appeal against an order confirming the tax demand, interest, and penalty.
Facts
The assessee was subject to a tax demand for the period from 2017-18 to January 2024. An order-in-original was issued, confirming a tax due of Rs. 1.86 crore under Section 74 of the CGST Act. The assessee contended that Rs. 72.83 lakh had already been paid and appropriated by the department before the order was passed. Despite this, the order confirmed the full amount, imposed interest, and levied a penalty equal to the tax amount. The assessee had paid an additional Rs. 3.74 lakh towards interest. The assessee challenged this order.
The court noted that there was no violation of the principles of natural justice. However, since the assessee was aggrieved by the order and had already paid the entire disputed tax amount, they were seeking a remedy.
Decision
The court did not quash the order but granted the assessee liberty to file a statutory appeal within a period of 30 days. The court recognized that while there was no procedural violation, the assessee had a legitimate grievance regarding the confirmed demand, especially considering the prior payment that was not fully accounted for. By granting the assessee time to file a formal appeal, the court provided a proper forum for the dispute to be adjudicated on its merits.
Key Takeaways
- Discretion of the Court: Even in the absence of a violation of natural justice, a court may use its discretion to allow an assessee to pursue a statutory remedy.
- Payment of Disputed Amount: The fact that the assessee had already paid the full disputed tax amount was a significant factor in the court’s decision, demonstrating the assessee’s good faith and intent to resolve the matter.
- No Bypass of Statutory Process: The court did not interfere with the order itself but redirected the assessee to the appropriate legal channel, thereby upholding the sanctity of the statutory appeal process.
Issue
Whether an assessee who has already paid the full disputed tax amount can be granted additional time to file a statutory appeal against an order confirming the tax demand, interest, and penalty.
Facts
The assessee was subject to a tax demand for the period from 2017-18 to January 2024. An order-in-original was issued, confirming a tax due of Rs. 1.86 crore under Section 74 of the CGST Act. The assessee contended that Rs. 72.83 lakh had already been paid and appropriated by the department before the order was passed. Despite this, the order confirmed the full amount, imposed interest, and levied a penalty equal to the tax amount. The assessee had paid an additional Rs. 3.74 lakh towards interest. The assessee challenged this order.
The court noted that there was no violation of the principles of natural justice. However, since the assessee was aggrieved by the order and had already paid the entire disputed tax amount, they were seeking a remedy.
Decision
The court did not quash the order but granted the assessee liberty to file a statutory appeal within a period of 30 days. The court recognized that while there was no procedural violation, the assessee had a legitimate grievance regarding the confirmed demand, especially considering the prior payment that was not fully accounted for. By granting the assessee time to file a formal appeal, the court provided a proper forum for the dispute to be adjudicated on its merits.
Key Takeaways
- Discretion of the Court: Even in the absence of a violation of natural justice, a court may use its discretion to allow an assessee to pursue a statutory remedy.
- Payment of Disputed Amount: The fact that the assessee had already paid the full disputed tax amount was a significant factor in the court’s decision, demonstrating the assessee’s good faith and intent to resolve the matter.
- No Bypass of Statutory Process: The court did not interfere with the order itself but redirected the assessee to the appropriate legal channel, thereby upholding the sanctity of the statutory appeal process.
W.M.P.(MD) No.16730 of 2025
| – | that they are registered co-operative society carrying on the activity of trading of ration supplies (both PDS and Non PDS); |
| – | that due to lack of knowledge regarding the tax aspects; |
| – | that most of the purchases, a delivery order is being issued by Tamil Nadu Civil Supplies Corporation and there is no tax invoice as not issued and they are not aware of the tax rates on the products supplied by them and they have raised tax invoices only for few products; |
| – | that because of the above there was a difference in the tax payment and they have recalculated and attached a reconciliation statement with accurate figures; |
| – | that in the initial years (2017-28 to 2019-20) they have failed to claim the ITC by which a huge amount of ITC has been left unclaimed due to lack of knowledge; |
| – | that they request for a week’s time for payment of balance tax considering their previous payments.” |