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2022 (4) TMI 410 - HC - GSTCancellation of GST registration of petitioner - petitioner has failed to file returns continuously for a period of six months - HELD THAT - The issue that arises for consideration in this Writ Petition was detailed considered by this Court in the case TVL. SUGUNA CUTPIECE CENTER VERSUS THE APPELLATE DEPUTY COMMISSIONER (ST) (GST) , THE ASSISTANT COMMISSIONER (CIRCLE) , SALEM BAZAAR. 2022 (2) TMI 933 - MADRAS HIGH COURT , wherein, considering the revenue of the Government, certain reliefs were granted to the petitioners therein - it was held in the case that Since, no useful will be served by not allowing persons like the petitioners to revive their registration and integrate them back into the main stream, I am of the view that the impugned orders are liable to be quashed and with few safeguards. The petition is allowed.
Issues:
1. Cancellation of GST registration due to failure to file returns continuously for six months. 2. Dismissal of appeal against cancellation of GST registration on the ground of limitation. 3. Interpretation of provisions related to limitation under the TNGST Act, 2017. 4. Consideration of time extensions granted by the Supreme Court due to the Covid-19 pandemic. 5. Application of Notifications issued by the Central Board of Indirect Taxes and Customs for waiver of late fees. 6. Justifiability of cancellation of GST registration without providing adequate reasons. 7. Prayers for quashing impugned orders and revocation of cancellation of GST registration. Issue 1: Cancellation of GST registration due to failure to file returns continuously for six months: The petitioner's GST registration was cancelled by the first respondent for not filing returns for six consecutive months. The cancellation was challenged through Writ Petition No.27365 of 2021, seeking to quash the order as being without jurisdiction and against the principles of natural justice. Issue 2: Dismissal of appeal against cancellation of GST registration on the ground of limitation: In Writ Petition No.27368 of 2021, the second respondent dismissed the appeal filed by the petitioner under Section 107(1) of the TNGST Act, 2017 against the cancellation of GST registration, citing limitation as the reason for dismissal. Issue 3: Interpretation of provisions related to limitation under the TNGST Act, 2017: The dismissal of the appeal was based on Section 107(4) of the TNGST Act, 2017, which allows a one-month extension if the appellant was prevented by sufficient cause from filing the appeal within the initial three-month period. The court emphasized that appeals filed after four months from the date of the decision or order communicated would not be entertained. Issue 4: Consideration of time extensions due to the Covid-19 pandemic: The judgment highlighted the Supreme Court's orders excluding the period from 15.03.2020 to 14.03.2021 from the computation of limitation periods. However, in this case, the appeal was filed after the extended period, making the appellant ineligible for the relaxation granted by the Supreme Court. Issue 5: Application of Notifications for waiver of late fees: Notifications issued by the Central Board of Indirect Taxes and Customs were cited to support the petitioner's argument that late fees were waived for certain periods. The petitioner had filed returns and made payments in accordance with these notifications. Issue 6: Justifiability of cancellation of GST registration without providing adequate reasons: The petitioner contended that the cancellation of the GST registration lacked justifiable reasons, as the respondent cancelled it solely based on the petitioner's failure to respond to a Show Cause Notice without providing further explanation. Issue 7: Prayers for quashing impugned orders and revocation of cancellation of GST registration: The petitioner sought the quashing of the impugned orders and revocation of the cancellation of GST registration, emphasizing the steps taken to comply with late fee payments and return filings post the cancellation order. In the final judgment, the court allowed the Writ Petitions subject to specific conditions. The petitioners were directed to file returns for the period before the cancellation of registration, pay any outstanding taxes, interest, fines, and fees, and ensure that any Input Tax Credit was scrutinized and approved before utilization. The court emphasized the importance of integrating the petitioners back into the GST system to prevent unintended privileges and ensure tax compliance. The respondents were instructed to make necessary changes to facilitate the petitioners' compliance within specified timelines.
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