Bridging the Gap: Kerala High Court Provides Relief to GST Litigants Amid Tribunal Vacancy

In a significant order addressing the practical hurdles faced by taxpayers, the High Court of Kerala has provided a lifeline to entities struggling to pursue statutory appeals under the Goods and Services Tax (GST) framework. With GST Appellate Tribunals yet to be functional across the state, the Court has ensured that the right to appeal remains preserved for those impacted by tax demand orders.

The Tax Dispute: A Procedural Impasse

The petitioner, M/s. Kurian Abraham (P) Limited , found itself caught in a legal bind. After facing a penalty order under the CGST/SGST Act—which the company contested through the first appellate authority—the appeal was eventually dismissed by the Joint Commissioner (Appeals).

While the petitioner sought to escalate the matter to the second appellate level as mandated by Section 112 of the CGST Act , they were met with a systemic obstacle: the GST Appellate Tribunal had not yet been constituted. Despite having already remitted the disputed penalty amount under protest to secure the release of their confiscated goods and vehicle, the company faced a potential foreclosure of their legal rights due to the lack of a forum.

Arguments at the Bar

The petitioner’s counsel, Adv. Ramesh Cherian John, emphasized that the lack of a functional Tribunal should not act as an indefinite barrier to the petitioner's statutory right to challenge adverse orders.

Conversely, the Government Pleader, Smt. Reshmitha R. Chandran, acknowledged the administrative reality, noting that the process to establish the Tribunal is currently underway. The government did not object to granting the petitioner a period of relief to file the appeal once the infrastructure is in place.

The Court’s Reasoning

Justice Ziyad Rahman A.A., presiding over the matter, recognized the inherent unfairness in penalizing a litigant for missing a deadline caused by the state’s own regulatory delay. By invoking the Court’s jurisdiction, the judge effectively suspended the limitation clock until the functional availability of the judicial body intended by the statute.

Key Observations

The judgment underscores the judiciary’s role in balancing administrative delays with the rights of taxpayers:

• "The petitioner, intends to challenge the Ext.P10 by availing the remedy of second appeal as contemplated under Section 112 of the CGST Act. However, as the Tribunal has not been constituted so far, he is unable to invoke the said remedy."
• "In such circumstances, I am of the view that this writ petition can be disposed of, reserving the right of the petitioner to invoke the statutory remedies."
• "Accordingly, this writ petition is disposed of, declaring that the petitioner shall be entitled to submit an appeal against Ext.P10 order, within a period of one month from the date of constitution of the Tribunal."

A Pathway Forward

The final decision is a clear victory for the principles of natural justice. By granting the petitioner one month from the date of the Tribunal's official constitution to file their appeal, the Court has prevented the loss of a legal remedy that is statutory in nature.

For other businesses in similar straits, this order serves as a vital precedent. It reinforces that while administrative processes for tax tribunals may be delayed, the individual’s right to seek judicial or quasi-judicial review remains intact. Until the GST Appellate Tribunal becomes operational, litigants now have a clear roadmap to protect their interests without fear of their appeals being time-barred.