A pedantic viewpoint cannot be used to negate the party’s substantive right of appeal, which is established by legislation.
In a significant ruling, the Andhra Pradesh High Court excused a delay of 25 days and highlighted that if the bank account is frozen, it is impossible to make the required 10% pre-deposit for submitting a Goods and Service Tax (GST) appeal.
The petitioner’s business premises were inspected by the Assistant Commissioner Regional GST Audit and Enforcement Wing, who determined a taxable amount of Rs.5,48,29,347/-, comprising tax, penalty, and interest.
The applicant, M/s S A Iron, and Metal, questioned the legality of the Assessing Authority’s ruling under Section 107 of the A.P. G.S.T Act, 2017, as well as the delay of 25 days in filing the appeal. Because the Department had blocked the petitioner’s accounts, he was unable to mobilize the funds necessary for the statutory pre-deposit of 10% of the disputed tax for filing an appeal, and the appeal was denied.
Although the petitioner filed an appeal within the allowed period of time, the petitioner’s lawyer would argue that the Appellate Authority rejected the appeal without taking into account the real reason the petitioner filed the appeal so late and issued the impugned order, which is illegal.
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The petitioner just said that he had experienced an unexpected and serious financial problem, the government Pleader claimed, without providing any further information on the financial catastrophe his company had experienced. The claim that it was difficult to get the loan amount was untrue.
As per the opinion of the Division Bench, Justices U Durga Prasad Rao and Venkata Jyothirmayi Pratapa, if the authorities freeze the bank account of the applicant then it is pertinent fact to recognize the delay as the pre-deposit of the 10% disputed tax during the filing of the petition is obligatory. The selected view of the concerned commissioner seems to be forcing the horse to run post-tying the legs.
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We do not agree with the explanations given by the concerned Commissioner for dismissing the appeal. Since the reason for the delay is acceptable and falls within the permissible period of limitation, the appeal may be heard. We believe that the challenged order merits being overturned, the Court stated, in light of the wording used under Section 107(4) of the CGST Act and the surrounding factual and legal context.
| Case Title | M/s S A Iron, and Metal |
| Citation | W.P.No.15490 OF 2023 |
| Date | 30.09.2022 |
| Advocate | V Siddharth Reddy |
| Andhra Pradesh High Court | Read Order |
