# M/S Dial For Cool, Noida v. State of U.P. & Ors

- **Citation:** (2024) 1 ILRA 1165
- **Court:** High Court of Judicature at Allahabad
- **Decided:** 2023-11-30
- **Case number:** Writ Tax No. 1338 of 2022
- **Bench:** Ajay Bhanot
- **Source:** https://unisonlegal.in/judgment/allahabad-high-court/m-s-dial-for-cool-noida-v-state-of-u-p-ors-50846
- **Pages:** 5

## Headnote

Civil Law - The Central Goods and Services
Tax Act, 2017 - Section 107 - Challenge to
dismissal of appeal by order dated 28.09.2022
as time-barred under Section 107 of CGST Act -
Appellate authority failed to verify mode of
service or record satisfaction of communication
of order dated 04.03.2022 cancelling GST
registration - Limitation period commences from
date of communication, not order date -
Impugned order lacks findings on service or
knowledge, rendering it legally flawed - Order
set aside, matter remitted to appellate authority
for fresh adjudication with hearing, to be
completed within two months.
List of Cases cited:

## Text

1 All. M/S Dial For Cool, Noida Vs. State of U.P. & Ors.
1165
142(2) of the said Rules. It is needless to
say that the said payment shall be dealt
with
or
adjusted
by
the
concerned
respondent No.3 in accordance with law
more particularly as per the provisions
contained in Section 74 of the CGST Act,
2017.

(28) For all the aforesaid reasons, this
Court does not find any merits in the
present petition and as such the same is
dismissed. However, in the facts of the
present case, there shall be no order as to
costs.
----------
(2024) 1 ILRA 1165
ORIGINAL JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 30.11.2023

BEFORE

THE HON'BLE AJAY BHANOT, J.

Writ Tax No. 1338 of 2022

M/S Dial For Cool, Noida ...Petitioner
Versus
State of U.P. & Ors. ...Respondents

Counsel for the Petitioner:
Sri Prathamesh Upadhyay

Counsel for the Respondents:
C.S.C.

Civil Law - The Central Goods and Services
Tax Act, 2017 - Section 107 - Challenge to
dismissal of appeal by order dated 28.09.2022
as time-barred under Section 107 of CGST Act -
Appellate authority failed to verify mode of
service or record satisfaction of communication
of order dated 04.03.2022 cancelling GST
registration - Limitation period commences from
date of communication, not order date -
Impugned order lacks findings on service or
knowledge, rendering it legally flawed - Order
set aside, matter remitted to appellate authority
for fresh adjudication with hearing, to be
completed within two months.
List of Cases cited:

1. S/S Patel Hardware Vs Commissioner, St.
G.S.T. & ors., Writ Tax No.1388 of 2018

2. Singh Traders Vs Additional Commissioner
Grade-2 & ors., Writ Tax No.661 of 2020

3. M/s. Pearl and Co. Vs The Commissioner of
Commercial Taxes & anr., W.P.(MD) No.19127 of
2022 and W.M.P.(MD) No.13962 of 2022

4. Tvl. Suguna Cutpiece Vs Appellate Deputy
Commissioner (ST) (GST) & ors., W.P.Nos.
25048, 25877, 12738 of 2021, decided on
31.01.2022

(Delivered by Hon'ble Ajay Bhanot, J.)

1. Heard Shri Prathamesh Upadhyay,
learned counsel for the petitioner and Shri
Bipin Kumar Pandey, learned Additional
Chief
Standing
Counsel
for
the
respondents-State.

2. The GST registration of the
petitioner
was
cancelled
by
the
authority/Assistant Commissioner, Noida
Sector-10/respondent No.3 in the first
instance by the order dated 04.03.2022. The
petitioner carried the said order in appeal
before
the
learned
appellate
authority/Additional Commissioner, Grade2 (Appeal)-Ist, State Tax, Noida.

3. The petitioner has assailed the
order dated 28.09.2022 passed by the
learned
appellate
authority/Additional
Commissioner, Grade-2 (Appeal)-Ist, State
Tax, Noida, wherein the learned appellate
authority has rejected the appeal filed by
the petitioner under Section 107 of the
CGST Act on the footing that the appeal
was barred by limitation. The impugned
order references the provisions of Section
107 of the Act and notices that the period of
limitation of three months has been
1166 INDIAN LAW REPORTS ALLAHABAD SERIES
provided for filing the appeal. In this case
the appeal was filed after a period of four
months and was accordingly barred by
limitation.

4. Section 107 of the Central Goods
and Services Tax Act, 2017 pari materia
with Section 107 of the Uttar Pradesh
Goods and Services Tax Act are relevant
part which provide for limitation and the
same are extracted hereunder:

"Section
107.
Appeals
to
Appellate Authority-

(1) Any person aggrieved by any
decision or order passed under this Act or
the State Goods and Services Tax Act or the
Union Territory Goods and Services Tax
Act by an adjudicating authority may
appeal to such Appellate Authority as may
be prescribed within three months from the
date on which the said decision or order is
communicated to such person.

(2) The Commissioner may, on
his own motion, or upon request from the
Commissioner
of
State
tax
or
the
Commissioner of Union territory tax, call
for and examine the record of any
proceedings in which an adjudicating
authority has passed any decision or order
under this Act or the State Goods and
Services Tax Act or the Union Territory
Goods and Services Tax Act, for the
purpose of satisfying himself as to the
legality or propriety of the said decision or
order and may, by order, direct any officer
subordinate to him to apply to the Appellate
Authority within six months from the date
of communication of the said decision or
order for the determination of such points
arising out of the said decision or order as
may be specified by the Commissioner in
his order.

(3) Where, in pursuance of an
order under sub-section (2), the authorised
officer makes an application to the
Appellate Authority, such application shall
be dealt with by the Appellate Authority as
if it were an appeal made against the
decision or order of the adjudicating
authority and such authorised officer were
an appellant and the provisions of this Act
relating to appeals shall apply to such
application.

(4) The Appellate Authority may,
if he is satisfied that the appellant was
prevented
by
sufficient
cause
from
presenting the appeal within the aforesaid
period of three months or six months, as the
case may be, allow it to be presented within
a further period of one month."

5. Section 169 of the Act provides for
manner of service of notice, decision/order
or summons which is relevant to the
controvery is reproduced hereunder:

"Section 169. Service of notice
in certain circumstances-

(1)
Any
decision,
order,
summons, notice or other communication
under this Act or the rules made thereunder
shall be served by any one of the following
methods, namely:?

(a) by giving or tendering it
directly or by a messenger including a
courier to the addressee or the taxable
person or to his manager or authorised
representative or an advocate or a tax
practitioner holding authority to appear in
the proceedings on behalf of the taxable
person or to a person regularly employed
by him in connection with the business, or
to any adult member of family residing
with the taxable person; or
1 All. M/S Dial For Cool, Noida Vs. State of U.P. & Ors.
1167

(b) by registered post or speed
post or courier with acknowledgement
due, to the person for whom it is intended
or his authorised representative, if any, at
his last known place of business or
residence; or

(c) by sending a communication
to his e-mail address provided at the time
of registration or as amended from time to
time; or

(d) by making it available on the
common portal; or

(e) by publication in a newspaper
circulating in the locality in which the
taxable person or the person to whom it is
issued is last known to have resided,
carried on business or personally worked
for gain; or

(f) if none of the modes aforesaid
is practicable, by affixing it in some
conspicuous place at his last known place
of business or residence and if such mode
is not practicable for any reason, then by
affixing a copy thereof on the notice board
of the office of the concerned officer or
authority who or which passed such
decision or order or issued such summons
or notice.

(2)
Every
decision,
order,
summons, notice or any communication
shall be deemed to have been served on the
date on which it is tendered or published or
a copy thereof is affixed in the manner
provided in sub-section (1).

(3) When such decision, order,
summons, notice or any communication is
sent by registered post or speed post, it
shall be deemed to have been received by
the addressee at the expiry of the period
normally taken by such post in transit
unless the contrary is proved."

6. The provisions of Section 107 of
the CGST Act contemplates that the period
of limitation will commence from the date
the order is "communicated to such
person". The interpretation of the aforesaid
phrase "communicated to the person"
which is the start point of limitation, arose
for consideration before this Court in S/S
Patel Hardware v. Commissioner, State
G.S.T. and others (Writ Tax No.1388 of
2018). S.D.Singh J. while examining the
provision held as under:

"8. Keeping in mind the fact that
the delay in filing the appeal may not be
condoned beyond the period of one month
from the expiry of period of limitation, the
phrase "communicated to such person"
appearing in Section 107(1) of the Act
commend a construction that would imply
that the order be necessarily brought to the
knowledge of the person who is likely to be
aggrieved. Unless such construction is
offered, the right of appeal would itself be
lost though a delay of more than a month
would in all such cases be such as may
itself not warrant such strict construction."

7. Similarly, the observations of
Pankaj Bhatia J. in Singh Traders v
Additional Commissioner Grade-2 and
others (Writ Tax No.661 of 2020)
regarding
satisfaction
of
service
in
accordance with the provisions of Section
169 also become applicable to the facts of
this case.

8. The mandatory prerequisites for
reckoning the start point of period of
limitation are these. The authority has to
make a finding in regard to the mode of
copy of the order and also whether service
1168 INDIAN LAW REPORTS ALLAHABAD SERIES
upon the concerned person is complete.
Secondly the authority has to record its
satisfaction that the order has been
"communicated to the assessee/person".

9. The impugned order does not
reference the mode of service of the order
nor does it record its satisfaction of service
in the order. The finding that the order was
"communicated to the assessee/person" is
also
absent.
Learned
tribunal
was
misdirected in law, inasmuch as, it
neglected to record its satisfaction of the
mandatory prerequisites for triggering the
clock of limitation.

10. There is another aspect which
needs to be adverted to. The authority
below
while
deciding
the
issue
of
cancellation of registration of a dealer is
liable to be guided by holdings of the
Madras High Court in M/s. Pearl and Co.
v. The Commissioner of Commercial
Taxes and another, (W.P.(MD) No.19127
of 2022 and W.M.P. (MD) No.13962 of
2022)
wherein
the
consequences
of
cancellation of registration of a dealer and
the
approach
of
the
revenue
while
considering such matters was set out as
follows:

"6.Considering the submission
and perusal of the materials, this Court is of
the view that restoring the registration
would not cause any harm to the
department on the other hand it would be
beneficial for the state to earn revenue.
Further, in the case of Tvl.Suguna Cutpiece
Vs Appellate Deputy Commissioner (ST)
(GST) and others (W.P.Nos. 25048, 25877,
12738
of
2021
etc..
batch),
dated
31.01.2022. There some of the petitioner
filed an appeal beyond the period of
limitation either for filing application for
revocation of cancellation, while some of
them had directly filed a writ petition
against the order cancelling the registration.
While some of them filed appeal beyond
the statutory period of limitation, there was
further delay in filing the writ petition.
However, considering the over all facts and
circumstances of the case, it was held that
no useful purpose will be served by
keeping those petitioners out of the Goods
and Services Tax regime, as such assessee
would still continue to do business and
supply goods/services. By not bringing
them back to the Goods and Services Tax
fold/regime, would not further the interest
of the revenue. Relief was granted under
similar circumstances with the following
directions:

"216. Since, no useful will be
served by not allowing persons like the
petitioners to revive their registration and
integrate them back into the main stream, I
am of the view that the impugned orders
are liable to be quashed and with few
safeguards.

217.
There
are
adequate
safeguards under the GST enactments
which can also be pressed against these
petitioners even if their registration are
revived so that, there is no abuse by these
petitioners and there is enough deterrence
against default in either paying tax or in
complying with the procedures of filing
returns.

218. Further, the Government
requires tax to meet its expenditure. By not
bringing these petitioners within the GST
fold,
unintended
privilege
may
be
conferred on these petitioners unfairly to
not to pay GST should they end supplying
goods and/or services without registration.
For example, a person renting out an
immoveable property will continue to
1 All. M/S Hindustan Herbal Cosmetics, Delhi Vs. State of U.P. & Ors.
1169
supply
such
service
irrespective
of
registration or not.

219. Therefore, if such a person is
not allowed to revive the registration, the
GST will not be paid, unless of course,
the recipient is liable to pay tax on
reverse charge basis. Otherwise, also
there will be no payment of value added
tax. The ultimate goal under the GST
regime will stand defeated. Therefore,
these petitioners deserve a right to come
back into the GST fold and carry on their
trade and business in a legitimate manner.

220. The provisions of the GST
Enactments and the Rules made there
under read with various clarifications
issued
by
the
Central
Government
pursuant to the decision of the GST
Council and the Notification issued
thereunder the respective enactments also
make it clear, intention is to only
facilitate and not to debar and derecognised assesses from coming back
into the GST fold.

11. The impugned order dated
28.09.2022 passed by the respondent
No.2/learned appellate authority is liable
to be set aside and is set aside.

12. The matter is remitted to the
learned appellate authority for fresh
adjudication in accordance with law.

13. The learned appellate authority
is directed to decide the controversy in
light of the observations made in this
judgement
and
upon
giving
an
opportunity of hearing to the petitioner.

14. The entire exercise shall be
completed within a period of two months
from the date of receipt of a certified copy
of this order.

15. The writ petition (tax) is allowed.
----------
(2024) 1 ILRA 1169
ORIGINAL JURISDICTION
CIVIL SIDE
DATED:ALLAHABAD 02.01.2024

BEFORE

THE HON'BLE SHEKHAR B. SARAF, J.

Writ Tax No. 1400 of 2022

M/S Hindustan Herbal Cosmetics, Delhi
 ...Petitioner
Versus
State of U.P. & Ors. ...Respondents

Counsel for the Petitioner:
Sri Shubham Agarwal

Counsel for the Respondents:
Sri Ravi Shanker Pandey,C.S.C.

Civil Law - The Central Goods and
Services Tax Act, 2017 - Section 129 -
Challenge to penalty order dated 24.05.2018
and appellate order dated 29.08.2019 -
Penalty imposed for incorrect vehicle number
in e-way bill (DL1 AA 3552 instead of DL1 AA
5332) - Typographical error with no evidence
of intent to evade tax - No other infraction
found, as tax invoice, bilty, and e-way bill
were consistent - Mens rea for tax evasion
required for penalty under Section 129 of
CGST Act - Impugned orders quashed as
without jurisdiction and illegal - Writ petition
allowed, consequential reliefs to be provided
within four weeks.

List of Cases cited:

1. M/s. Varun Beverages Ltd. Vs St. of U.P. &
ors., 2023 U.P.T.C. (113) 331

2. Assistant Commissioner (ST) & ors. Vs M/s.
Satyam Shivam Papers Pvt. Ltd. & anr., 2022
U.P.T.C. (110) 269 (SC)