Appeal dismissed for non-prosecution without proper notice must be restored for decision on merits.

The petitioner challenged an order dated 5 March 2026 passed by the Joint Commissioner of State Tax (Appellate Authority), Indore Division-I, dismissing its statutory appeal for non-prosecution/non-appearance.

The appeal had been filed on 17 October 2022 against a demand of ₹81,46,488 raised by the Deputy Commissioner of State Tax, Indore Division, by order dated 7 September 2022. The petitioner had deposited ₹6,04,788 as pre-deposit, and the appeal was formally accepted on 20 December 2023.

Although hearing notices dated 9 February 2024, 21 March 2024 and 2 March 2026 were uploaded on the GST portal under the “Additional Notices/Orders” tab, the petitioner claimed that it had not received proper communication and was under the impression that the hearing date would be separately communicated.

The appellate authority thereafter dismissed the appeal for non-prosecution. The petitioner sought quashing of that order and remand for a hearing on merits.

1. Whether the appellate authority was justified in dismissing the petitioner’s appeal for non-prosecution/non-appearance instead of deciding it on merits, particularly where the petitioner had made the prescribed pre-deposit and disputed proper service of hearing notices?

2. Whether the petitioner was required to first invoke the statutory remedy for setting aside an order of dismissal for default before approaching the High Court under Article 226 of the Constitution?

The Court applied Article 226 of the Constitution of India concerning the High Court’s power of judicial review and examined Sections 111(1) and 111(2)(f)–(g) of the Central Goods and Services Tax Act, 2017, which provide that the appellate tribunal is guided by natural justice, may regulate its procedure, may dismiss a representation/appeal for default or decide it ex parte, and may set aside an order of dismissal for default or an ex parte order.

The Court also referred to Section 113 of the 2017 Act, under which the appellate authority/tribunal is required to pass appropriate orders confirming, modifying or annulling the decision or order appealed against.

The governing principles were that an appeal validly constituted with the requisite pre-deposit should ordinarily receive a decision on merits, and that the principles of natural justice require a meaningful opportunity of hearing, including proper communication of the hearing date.

The Court held that the appeal had been duly constituted and accompanied by the required pre-deposit, and found no apparent reason why the petitioner would intentionally fail to prosecute an appeal involving a substantial tax demand after depositing ₹6,04,788.

Although Sections 111(2)(f) and (g) empowered the appellate forum to dismiss an appeal for default and to set aside such dismissal, the Court considered that the petitioner should not be left without an effective decision on the merits or be compelled to pursue a second appeal when the first appeal had been dismissed solely for non-prosecution.

The petitioner’s assertion that the notices were merely uploaded under a GST portal tab and were not otherwise effectively communicated raised a legitimate natural-justice concern.

Accordingly, the Court exercised its writ jurisdiction, set aside the dismissal, and directed reconsideration of the appeal after granting a proper opportunity of hearing. The Court additionally advised the Department to supplement portal-based service with SMS or email communication to reduce avoidable litigation concerning notice.

The matter was remanded to the Appellate Authority for fresh adjudication after granting the petitioner due opportunity of hearing.

To avoid further delay, the petitioner was directed to appear before the Appellate Authority on 30 September 2026.