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The High Court took into consideration the relevant provision of CGST and MGST Rules and noted that an order would not have effect unless it is digitally signed.
A Division bench of Bombay High Court comprising Justice K.R. Shriram & Justice A.S. Doctor has held that the limitation period to file an appeal against the order of cancellation of GST registration would only start after the order is digitally signed by the officer.
The petitioner had approached the Bombay High Court after their appeal against the order of cancellation of GST registration was dismissed on the ground that the appeal was not filed within the prescribed period of 3 months from the date of order.
The petitioner argued that the order of cancellation was passed on 14 November 2019 and was made available electronically. However, Rule 26(3) of the Central Goods and Services Tax Rules, 2017 which is pari materia to Maharashtra Goods and Services Tax Rules, 2017 states that orders issued under Chapter III of the rules are to be authenticated by a digital signature certificate or through E-signature. The petitioner argued that the order copy was digitally signed only on 19 May 2021 and, therefore, the limitation period should be calculated from 19 May 2021.
The respondent argued before the court that the petitioner cannot take the stand that the order was not digitally signed when the unsigned order was received by the petitioner electronically.
The court while rejecting the contentions of the respondent noted that:
“If this stand of the respondent has to be accepted, then the Rules which prescribe specifically that digital signature has to be put will be rendered redundant. In our view, unless digital signature is put by the issuing authority that order will have no effect in the eyes of law.”
The court while passing the order in favor of the petitioner quashed and set aside the order of the respondent and directed the respondent to give a personal hearing to the petitioner with advance notice of 7 working days. The court also directed the respondent to decide the case of the petitioner on merits and pass a reasoned order.
Case title: Ramani Suchit Malushte versus Union of India & Ors.
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