2026-VIL-1145-KAR
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SGST High Court Cases

GST - Limitation for Revenue's appeal against refund sanction orders under Section 107(2) of CGST Act, 2017 - Respondent was sanctioned refund of unutilised input tax credit on capital goods - Commissioner reviewed the sanction orders and directed filing of appeals before the Commissioner (Appeals), which allowed them, quashed the refund orders and directed recovery with interest – In the impugned order the Single Judge held the appeals were barred by limitation - Whether the appeals preferred by the Revenue before the Commissioner (Appeals) were barred by limitation under Section 107 of CGST Act and were rightly set aside - HELD - Section 107(2) circumscribes any direction to file an appeal with the requirement that it be filed within six months from the date of communication of the order and as per Section 107(4) the Appellate Authority can condone delay only for a further period of one month - The review orders were passed beyond one year from the dates of the sanction orders, so none could direct filing of appeals within six months. The date of audit or audit observations is not relevant, as limitation runs from the date of communication of the order - Following the Delhi High Court decision in Grapes Digital case, the expression 'communication of the decision or order' in the context of intra-departmental communication must be construed as the date of issue of the order. As per the CBIC Instruction, post-audit and review must be completed within three months from the issue of the refund order and review must be completed at least thirty days before the expiry of the appeal period - All refund orders are transmitted online to the review module, and under Section 169(1)(d) communication is by making the order available on the common portal, so the time for communication cannot be indeterminate or open-ended - The power to recover erroneously granted refund under Section 73 is not relevant for determining limitation, and the assumption that limitation under Section 107 stands extended by Sections 73 and 74 is ex facie erroneous - The Commissioner (Appeals) had no jurisdiction to condone delay beyond one month, and the delay far exceeded that period - The appeals were filed beyond the period of limitation. The Single Judge rightly set aside the appellate order - The appeal of the Revenue is dismissed
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