The Bombay High Court has recently ruled that the limitation period for filing an appeal under the Goods and Services Tax (GST) law must be calculated in calendar months and cannot be treated as a fixed period of 120 days.
A Division Bench of Justice M.S. Karnik and Justice Sandesh D. Patil, while agreeing with the company's contention that the limitation period could not be calculated as a fixed 120 days, observed:
"We find substance in the submissions of learned Counsel for the Petitioner that there is a clear distinction between a period expressed in terms of 'days' and a period expressed in terms of 'months' with regard to the statutory language, the period under Section 107(1) and Section 107(4) of the CGST Act is required to be computed as calender months and not by mechanically treating the combined period of limitation with condonation as an inflexible period of 120 days."
The court was hearing a petition filed by United India Insurance Company Ltd. challenging the rejection of its GST appeal on the ground that it was delayed by two days.
The order under challenge was communicated to the company on August 11, 2025. It filed its appeal on December 11, 2025. The Appellate Authority calculated the four-month limitation period as 120 days and consequently treated the appeal as delayed by two days.
The High Court observed that Section 107(1) of the Central Goods and Services Tax (CGST) Act allows three months to file an appeal. Section 107(4) permits the Appellate Authority to allow filing within a further period of one month if sufficient cause is shown.
The Bench pointed out that Section 107(4) does not prescribe an additional period of 30 days or fix the overall limitation period at 120 days. Both provisions use the expression "months" to specify the limitation period.
Finding that the company's appeal was within the limitation period prescribed under Section 107, the court allowed the petition and quashed the May 7, 2026, order rejecting the appeal.
The Appellate Authority has been directed to hear the company's appeal on merits and in accordance with law.
For Petitioner: Advocates Lakshmi Menon and Chinmay Babhulkar \
For State: Additional Government Pleader Jyoti Chavan, along with AGP Manish Upadhye