Gauhati High Court Allows Revocation of GST Cancellation for Businessman GST Registration Cancellation Overturned; Court Orders Compliance for Restoration
In a significant judgment delivered by the Gauhati High Court, the cancellation of GST registration for a businessman was overturned, allowing for the possibility of revocation upon compliance with stipulated requirements. The petitioner, Shri Pankaj Mohan, faced cancellation of his GST registration due to non-filing of returns for six months. The court ruled that the registration could be restored if the petitioner complied with Rule 22(4) of the Central Goods and Services Tax (CGST) Rules, 2017, by furnishing all pending returns and settling tax dues, interest, and late fees within the specified period.
The case, presided over by Justice Kardak Ete, involved the petitioner, who runs a proprietorship firm named M/S Mohan Electromech, and claimed non-compliance due to miscommunication with his tax consultant. Despite facing obstacles in accessing the GST portal, the petitioner updated his GST returns and expressed his intent to continue business operations. The court acknowledged the serious civil consequences associated with the cancellation of GST registration and emphasized that the petitioner had demonstrated a willingness to comply with the necessary requirements.
During the proceedings, the petitioner's counsel argued that the cancellation was unsustainable as the petitioner had updated his returns quarterly up to October-December 2024. The counsel for the respondents conceded, agreeing that similar relief had been granted in previous cases by the court.
In delivering the judgment, Justice Ete referenced prior decisions, including the cases of Dhirghat Hardware Stores v. Union of India and Mr. Masuk Ahmed Barbhuiya v. The Union of India, which had addressed similar issues. The court directed the petitioner to approach the concerned authority within 60 days from the date of the judgment, emphasizing that the petitioner should comply with the requirements under Rule 22(4) for the restoration of GST registration.
Furthermore, the court clarified that the period stipulated under Section 73(10) of the CGST Act would be computed from the date of the order, excluding the financial year 2024-25, which would be governed by Section 44 of the Act. The petitioner was also directed to make payments for any arrears, including tax, penalty, interest, and late fees.
This judgment marks a crucial step in ensuring that businesses facing GST registration cancellations can seek rectification by complying with legal requirements. The decision underscores the importance of procedural compliance and the role of the judiciary in safeguarding business interests.
Bottom Line:
Cancellation of GST registration for non-filing of returns for six months can be revoked if the petitioner complies with Rule 22(4) of CGST Rules, 2017, by furnishing pending returns, paying tax dues, interest, and late fees within the stipulated period.
Statutory provision(s): Central Goods and Services Tax Act, 2017 - Section 29(2)(c), Rule 22 of CGST Rules, 2017, Section 73(10) of CGST Act
Shri Pankaj Mohan v. Union of India, (Gauhati) : Law Finder Doc Id # 2828336
