GSTAT Ernakulam set aside a Section 129(3) penalty order served 28 days after notice, holding it void ab initio for violating the seven-day timeline under Rule 161 of CGST Rules.
Seven-Day Timeline Breach Voids GST Penalty: GSTAT Ernakulam
The GST Appellate Tribunal, Ernakulam, quashed a penalty order under Section 129(3) of the CGST Act, 2017, ruling it void ab initio due to non-compliance with Rule 161 of the CGST Rules. The adjudicating authority issued the order 28 days after the personal hearing concluded, breaching the mandatory seven-day deadline.
The Tribunal reaffirmed that Rule 161, though procedural, is directory only when compliance is impossible. However, in absence of justification for delay, deviation renders the order invalid. The Court cited Section 11B of the CGST Act’s emphasis on time-bound adjudication.
This decision underscores the importance of strict adherence to procedural timelines in penalty proceedings. Tax authorities must prioritize timely adjudication, particularly in confiscation and penalty cases. Practitioners should scrutinize issuance dates and invoke Rule 161 routinely to challenge delayed orders.
Citations
- CGST Act, 2017, Section 129(3)
- CGST Rules, Rule 161
