The Patna High Court has delivered a significant order clarifying that certain time-barred GST appeals can be restored and heard on merits, provided assessees strictly comply with a special procedure laid down by the Central Board of Indirect Taxes and Customs (CBIC). The case arose from a writ petition filed against the dismissal of a first appeal under the Bihar Goods and Services Tax Act, 2017 (BGST Act), which had been rejected as beyond the condonable delay permitted by statute. The Division Bench, led by the Hon’ble Chief Justice with Hon’ble Mr. Justice Rajiv Roy, noted the subsequent issuance of CBIC’s Notification No. 53/2023–Central Tax dated 02 November 2023 and directed restoration of the appeal, subject to compliance with the notification’s conditions within the prescribed time.
The petition involved a challenge to the appellate authority’s refusal to entertain a delayed appeal. Under Section 107 of the BGST Act, an appeal must be filed within three months, with a further one-month condonable period on sufficient cause. Appeals filed beyond this outer limit cannot be condoned by either the appellate authority or the High Court in writ jurisdiction—a position the Bench reaffirmed while narrating the background.
What changed the legal landscape was CBIC’s Notification No. 53/2023–Central Tax. Recognizing the need to provide a one-time window, the notification extends the time for filing appeals against orders passed by the Proper Officer on or before 31 March 2023 under Sections 73 or 74 of the BGST/CGST framework. Under this special procedure, appeals may be filed (or deemed properly filed) on or before 31 January 2024, subject to specified pre-deposits and other conditions. The High Court expressly relied on this notification to grant relief.
Crucially, the notification mandates that appellants pay: (a) the entire admitted amount of tax, interest, fine, fee, and penalty arising from the impugned order; and (b) 12.5% of the remaining disputed tax (subject to a cap of ₹25 crore), with at least 20% of that 12.5% being paid through the Electronic Cash Ledger. It also clarifies that no refund will be processed, on account of this notification, until disposal of the appeal; and that the special window does not apply to demands not involving “tax.”
Applying these rules, the Court set aside the earlier order rejecting the petitioner’s appeal for delay and directed that the appeal be restored, provided the petitioner satisfies the notification’s deposit conditions within the stated deadline (i.e., on or before 31 January 2024). If the conditions are not met, the appeal would stand rejected. The Court also issued an important general clarification: where this Court had previously rejected writ petitions solely because the appeals were time-barred under Section 107(4), such assessees, too, may invoke the notification and seek restoration in accordance with its terms. The Commissioner of State Taxes, Government of Bihar, was directed to issue necessary instructions to ensure uniform application of this relief.
In sum, the order confirms that the special window created by CBIC allows restoration of delayed GST appeals concerning orders passed on or before 31 March 2023 under Sections 73/74, but only if assessees fulfil the stringent deposit requirements and meet the hard deadline of 31 January 2024. This balanced approach respects the statutory limits on condonation while utilizing the notification to prevent injustice in suitable cases.
Significance or Implication of the Judgment
This decision is practically significant for businesses and individuals in Bihar whose GST appeals were dismissed as time-barred. The Court has clarified that the CBIC’s one-time relaxation can revive such appeals, but only if the appellant acts promptly and complies fully with the specified pre-deposit conditions. It ensures that disputes under Sections 73 (non-fraud cases) and 74 (fraud or suppression cases) arising from orders passed up to 31 March 2023 are not permanently foreclosed for mere delay—so long as the appellant meets the deposit and procedural requirements before 31 January 2024. This improves access to appellate remedies while maintaining fiscal discipline through significant up-front payments. The administrative directions to the Commissioner of State Taxes to instruct officers and to permit restoration even where earlier writs were rejected solely on delay grounds promote uniformity and reduce unnecessary litigation over maintainability.
For taxpayers, the message is clear: (i) verify whether the impugned order falls within the cut-off period (on or before 31 March 2023), (ii) file or revive the appeal within the outer date of 31 January 2024, and (iii) be ready with the admitted liability plus 12.5% of the remaining disputed tax, ensuring that at least 20% of that 12.5% comes from the Electronic Cash Ledger. For the department, the ruling underscores the need to facilitate restoration promptly wherever the notification applies, and to avoid resisting restoration on technicalities once the pre-conditions are satisfied.
Legal Issue(s) Decided and the Court’s Decision with reasoning
- Whether the appellate authority or the High Court can condone delay beyond the additional one-month period prescribed in Section 107(4) of the BGST Act.
• Decision: No. Both the appellate authority and the High Court cannot condone delay beyond the statutory outer limit; this is settled law. The background portion of the order reiterates this position. - Whether, in view of CBIC Notification No. 53/2023–Central Tax, a time-barred appeal under Sections 73/74 can be treated as maintainable if the special conditions are met by 31 January 2024.
• Decision: Yes. The Court recognized the notification’s special window and held that appeals against orders passed on or before 31 March 2023 may be filed or deemed properly filed by 31 January 2024, subject to compliance with the specified pre-deposits and other conditions. - What are the financial pre-conditions for availing the notification’s benefit?
• Decision: The appellant must (i) pay the entire admitted dues arising from the impugned order and (ii) deposit 12.5% of the remaining disputed tax (max ₹25 crore), ensuring at least 20% of that 12.5% is deposited via Electronic Cash Ledger. No refund of amounts paid in excess of the notification’s requirement will be processed until the appeal is disposed of. - Whether the earlier rejection order in the petitioner’s appeal should be set aside and the appeal restored.
• Decision: Yes. The Court set aside the appellate rejection order and directed restoration on the condition that the petitioner satisfies the notification’s deposit requirements by 31 January 2024; failing which, the appeal would stand rejected. - Whether similarly situated assessees whose writ petitions were dismissed solely due to delay may also avail the notification.
• Decision: Yes. The Court clarified that such assessees can invoke the notification “de hors” earlier High Court orders that had rejected writs for delay, subject to full compliance with the notification. The Commissioner of State Taxes must issue instructions to ensure this relief is operationalized.
Case Title
M/s Vikash Enterprises Vs. The State of Bihar
Case Number
Civil Writ Jurisdiction Case No. 13293 of 2023.
Coram and Names of Judges
Hon’ble the Chief Justice; Hon’ble Mr. Justice Rajiv Roy.
Names of Advocates and who they appeared for
For the petitioner: Mr. Ranjeet Kumar, Advocate.
For the respondents (State): Mr. Vivek Prasad, GP-7; with Ms. Roona, A.C. to GP-7; Mr. Sanjay Kumar, A.C. to GP-7; Ms. Supragya, A.C. to GP-7; and Ms. Manisha Singh, A.C. to GP-7.
Link to Judgment
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