Section 107 and Limitation: GST Appeals Can Get Second Chance
Procedural Delays and GST Appeals: An Important Case
Section 107 limitation has been a challenge for many GST taxpayers. The recent case of Anand Kumar Hirawat highlights how procedural delays can be addressed fairly under the GST framework.
The Background of the Case
Anand Kumar Hirawat, a GST-registered sole proprietor, faced an adjudication order under Section 73 for short tax payments and excess ITC claims between April 2018 and March 2019. The tax demand, including penalties and interest, totaled ₹23.51 lakh. However, the order lacked evidence and violated natural justice principles.
Due to delays caused by the COVID-19 pandemic and negligence by his tax consultant, Hirawat’s appeal under Section 107 was filed late. Consequently, the Appellate Authority dismissed the appeal based solely on the delay.
Key Ruling by the Calcutta High Court
The Calcutta High Court intervened, stating that the dismissal was improper. The court held that statutory limitations should be interpreted liberally, especially in extraordinary circumstances like a pandemic. This decision clarified that:
- Section 5 of the Limitation Act, 1963, can apply to GST appeals under Section 107.
- Procedural fairness should allow appeals if the delay is justified.
What Does This Mean for Taxpayers?
This ruling emphasizes:
- Flexibility in GST Appeals: If you have a valid reason for delay, courts may grant relief.
- Natural Justice: Decisions violating natural justice can be overturned.
- Role of Limitation Act: Section 5 ensures delays are assessed on merit, promoting fairness.
How to Avoid Appeal Rejections
- Timely Filing: Ensure appeals under Section 107 are filed promptly.
- Document Delays: Maintain evidence if delays occur.
- Seek Professional Help: Engage reliable tax consultants to avoid procedural errors.
Final Thoughts
The Anand Kumar Hirawat case serves as a crucial reminder: Procedural fairness and flexibility matter. If your GST appeal faces delays, Section 107 and the Limitation Act might give you a second chance.