Revenue Must Rebut Taxpayer's Claimed Date Of GST Order Communication With Cogent Evidence: Allahabad High Court

The Allahabad High Court has reiterated that where a taxpayer discloses the actual date of communication of an order under the Uttar Pradesh Goods and Services Tax Act, 2017, the burden shifts to the Revenue to rebut that assertion with cogent material.

It further held that the appellate authority is bound to give an independent finding on the date of communication of the order.

Referring to the decisions of the division bench of the Allahabad High Court in Bambino Agro Industries Limited v. State of U.P. and Associate Molasses Transport Company v. State of U.P. & Another, Justice Piyush Agrawal held:

“The Revenue has utterly failed in the impugned orders to note the law laid down by the Division Bench of this Court in M/S Bambino Agro Industries Limited (supra), which has been followed by this Court in the case of M/s Associate Molasses Transport Company (supra). The Revenue has to endeavor to rebut the submissions made by the respective dealers with regard to actual date of communication by bringing on record cogent materials. Once the Revenue has utterly failed to rebut the submissions made by the respective parties, the impugned orders cannot sustain in the eye of law.”

A batch of writ petitions was filed before the High Court challenging appellate orders under the Uttar Pradesh GST law that dismissed the taxpayers' appeals solely on the ground of delay and laches, without examining the merits.

Referring to the judgment in Bambino Agro Industries Limited, the Court observed:

“Once the Division Bench of this Court has come to the conclusion that the date of communication as mentioned by the respective dealers shall be treated as actual date of communication, then the onus shifts on the Revenue to rebut by cogent materials. In absence thereof, the date of communication as declared by the dealer shall be treated as the date of actual communication and the limitation shall arise from such date.”

In Associate Molasses Transport Company, the Division Bench had remitted the matter to the appellate authority for fresh consideration of limitation in light of Bambino Agro Industries Limited.

Noting that these decisions were binding, the Court held,

“the appellate authority were bound to give its own independent finding while passing the impugned orders, but the appellate authority has utterly failed to follow the directions in the above-noted judgements and therefore, the impugned orders cannot be sustained in the eyes of law.”

Accordingly, the High Court quashed the impugned appellate orders and remitted the matters to the respective appellate authorities to pass fresh orders within two months, keeping in mind the principles laid down in Bambino Agro Industries Limited and M/s Associate Molasses Transport Company.