2022 (12) TMI 259 - HC - GST

Cancellation of the Registration Certificate of petitioner - failure to file Goods and Services Tax monthly returns for a continuous period of six months - HELD THAT - In view of the fact that this Court has been consistently following the directions issued in the case of TVL. SUGUNA CUTPIECE CENTER VERSUS THE APPELLATE DEPUTY COMMISSIONER (ST) (GST) , THE ASSISTANT COMMISSIONER (CIRCLE) , SALEM BAZAAR. 2022 (2) TMI 933 - MADRAS HIGH COURT and the Revenue/Department has also accepted the said view as evident from the fact that no appeal has been filed in any of the matters, this Court intends to follow the above order of this Court - It was held in the above 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, the impugned orders are liable to be quashed and with few safeguards - these petitioners deserve a chance and therefore should be allowed to revive their registration so that they can proceed to regularize the defaults. In view of the same, this Court feels that the benefit extended by this Court in Suguna Cutpiece Centre's case cited supra, may be extended to the Petitioner - petition allowed.

Summary

Issues:
Challenge to the cancellation of Registration Certificate due to failure to file GST returns for six months, Appeal rejection on the ground of limitation, Application of directions issued in previous cases to the current case.

Analysis:
The Writ Petition challenges the cancellation of the Registration Certificate based on the Petitioner's failure to file Goods and Services Tax monthly returns for six consecutive months, leading to the cancellation effective from 31.05.2019 under Section 29 of the Central Goods and Services Tax Act, 2017. The Petitioner, through counsel, argued that unawareness of the cancellation was due to the Petitioner's medical condition and subsequent treatment, with only a part-time Accountant handling statutory compliances. The Petitioner learned of the cancellation from other taxpayers and subsequently appealed, which was rejected by the appellate authority as time-barred.

Both counsels acknowledged a prior judgment in a similar case, where the Court issued specific directions. These directions included filing returns for the period before cancellation, payment of defaulted tax with interest, and fines within 45 days. The Court prohibited using unclaimed Input Tax Credit for payments and required approval before utilization. The judgment also mandated payment of GST in cash for subsequent periods and scrutinizing Input Tax Credit usage. The Court imposed restrictions to prevent misuse and specified steps for registration revival upon compliance.

Given the consistent application of the aforementioned directions in subsequent cases, the Court decided to extend the same benefits to the current Petitioner. Consequently, the Court ordered the Writ Petition to be governed by the terms outlined in the earlier judgment, with no costs incurred. The connected Miscellaneous Petitions were closed accordingly. The decision reflects the Court's adherence to established precedents and the equitable application of legal principles in similar circumstances.