Sanchayita Lahkar

The High Court of Kerala Single Bench of Justice Bechu Kurian Thomas held that an appeal under the Central Goods and Services Tax Act, 2017, cannot be dismissed solely on the ground of non-appearance by the appellant. The court set aside the orders passed by the Appellate Authority, which had dismissed the appeals without addressing the merits of the case. It directed the authority to reconsider the matter afresh and provide the petitioner with a new opportunity for hearing.

The petitioner, St. Antony Trading and Transport Pvt. Limited, Vellara House, Vylathur, Thrissur, represented by its Power of Attorney Holder, PV Mercy, approached the High Court under Article 226 of the Constitution of India. The petitioner sought to quash two appellate orders issued by the Joint Commissioner (Appeals), State GST Department, Kerala, for the financial years 2020-21 and 2021-22.

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The writ petition arose from proceedings initiated under Section 73 of the CGST Act, 2017, which pertains to determination of tax not paid or short paid or erroneously refunded, or input tax credit wrongly availed or utilized for any reason other than fraud or wilful misstatement or suppression of facts. Assessment orders for both financial years dated July 25, 2022 were issued against the petitioner.

In response, the petitioner filed appeals in Form GST APL 01 on November 7, 2022 for both assessment periods — May 1, 2020 to March 31, 2021 and April 1, 2021 to July 31, 2021. These appeals were registered as OIA JC TSR 2022 GSTA-462T and GSTA-463T. The Appellate Authority granted three adjournments to the petitioner, but upon continued absence, dismissed both appeals on January 31, 2025, solely citing non-appearance.

According to the petitioner, the impugned orders failed to state the points for determination, did not address any grounds raised in the appeal, and contained no analysis of facts or law. The petitioner asserted that such dismissals were in violation of the procedural requirements of Section 107(12) of the CGST Act.

It was further submitted that under the statutory scheme, the Appellate Authority is obligated to pass a reasoned order after applying its mind to the issues raised, irrespective of the presence of the appellant at the hearing. The petitioner contended that the appellate orders were legally unsustainable and warranted judicial review.

The respondent, represented by the Government Pleader, contended that sufficient opportunity had been granted to the petitioner to appear before the Appellate Authority. The respondent justified the dismissals based on the petitioner’s failure to avail the granted opportunities, arguing that no procedural irregularity occurred in the exercise of appellate jurisdiction.

The records showed that while the petitioner had defaulted in appearance even after three adjournments, the appellate orders were passed without recording any of the mandatory procedural elements under Section 107(12).

Justice Bechu Kurian Thomas addressed the core question of whether an appellate authority under the CGST Act can summarily dismiss an appeal due to the non-appearance of the appellant, without deciding the matter on merits.

The Court recorded: "Section 107(12) of the CGST Act specifically states that the order of the Appellate Authority disposing of the appeal shall be in writing and shall state the points for determination and the reasons for the decision."

The judgment noted that the provision places a legal obligation on the Appellate Authority to render a reasoned decision based on the materials available before it, and not merely on procedural default.

Justice Thomas further recorded:

"In the light of sub-clause (12) of Section 107 of the CGST Act, it is evident that the Appellate Authority has to consider the matter on merits and is not entitled to dismiss an appeal merely for non-appearance."

The Court also referred to Section 107(11), which empowers the Appellate Authority to make such further inquiry as it thinks fit and thereafter pass orders confirming, modifying, or annulling the decision or order appealed against.

The Court stated: "Despite the failure of an appellant to appear, the Appellate Authority has to pass an order after determining the points for consideration, and the decision should be on merits."

To strengthen its reasoning, the Court cited a Division Bench judgment of the Patna High Court in Purushottam Stores vs. State of Bihar [(2023) 75 GSTL 276 (Patna)], observing:

"Such affirmation, modification or annulment shall not be an empty formality nor can it be mechanical, without the consideration of the grounds of appeal."

The Court quoted further from the Patna decision:

"The Appellate Authority cannot absolve itself from the obligation to conduct such further enquiry as is mandated under sub-section (11) of Section 107. Sub-section (12) also requires the order of the Appellate Authority disposing of the appeal to be in writing and specifically stating the points for determination, the decision thereon and the reasons for such decision."

Reference was also made to the Supreme Court's judgement in Commissioner of Income Tax, Madras v. Chenniappa Mudaliar, Madurai [(1969) 1 SCC 591]. The Court noted that the principle laid down in that case reinforced the requirement of deciding appeals on merits rather than dismissing them for default.

Justice Thomas observed that the impugned orders in the present case did not state any point for determination nor discussed any issues arising from the appeal. The Court recorded:

"There is no consideration of any of the issues raised by the appellant, and hence, the impugned order is perverse and is liable to be interfered with, in exercise of the jurisdiction under Article 226 of the Constitution of India."

The Court stated that procedural fairness and compliance with statutory mandates form the core of adjudicatory functions under tax laws. It was observed that an appellate order that does not address the contentions of the appellant or the statutory grounds of appeal fails the test of legality.

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The absence of findings or reasoning in the appellate orders, according to the Court, amounted to a failure to exercise jurisdiction as contemplated by the CGST Act.

Based on its findings, the Court set aside both the impugned appellate orders.

"Exhibit-P5 and Exhibit-P6 orders of the respondent are set aside and the respondent is directed to reconsider the matter afresh, after granting a fresh opportunity of hearing to the petitioner."

The Court allowed the writ petition without granting any further relief beyond remand.

Advocates Representing the Parties

For the Petitioner: Ammu Charles, K. Manoj Chandran, S.A. Mansoor (Pattanam)

For the Respondent: Jasmin M.M., Government Pleader

Case Title: St. Antony Trading and Transport Pvt. Limited vs. Joint Commissioner (Appeals), State GST Department, Kerala

Neutral Citation: 2025: KER:30649

Case Number: WP(C) No. 14743 of 2025

Bench: Justice Bechu Kurian Thomas

[Read/Download order]