2023 (4) TMI 641 - HC - GST

Challenging the revocation of GST registration - Appeal rejected on the ground that the appeal was beyond the period of limitation - reasons for cancellation of the petitioner s GST registration is that he had not filed the returns for a period of six months - HELD THAT - The scope of the present petition is limited to the action of the respondents in cancelling the petitioner s GST registration. It is, thus, not necessary for this Court to examine whether there has been any other default on the part of the petitioner or whether sufficient opportunity has been provided to the petitioner to rectify the same. Since it is apparent that the order dated 15.02.2022 cancelling the petitioner s GST registration was passed in the violation of the principles of natural justice, the said order is liable to be set aside. The petition is allowed and the impugned order dated 15.02.2022 is set aside. The respondents are directed to forthwith restore the petitioner s GST registration.

Summary

Issues:
Challenge to order-in-appeal rejecting appeal against revocation of GST registration on the ground of limitation.

Analysis:
The petitioner challenged the order-in-appeal dated 24.01.2023, which rejected the appeal against the revocation of GST registration due to being beyond the limitation period. The cancellation of the registration was based on the petitioner's failure to file returns for six months. A show cause notice was issued on 02.09.2021, requiring the petitioner to justify why the registration should not be cancelled and to appear before the officer on 02.10.2021. The petitioner responded promptly by filing the returns by 14.09.2021, believing that addressing the cause would prevent adverse action. Despite this, the registration was cancelled on 15.02.2022 without affording a personal hearing as 02.10.2021 was a national holiday.

Analysis:
The Court found that the order of 15.02.2022 cancelling the registration was in violation of natural justice principles as no personal hearing was granted due to the holiday. The respondent argued that the petitioner must also pay outstanding interest to regularize the account with GST authorities. A notice was issued to pay a specific amount, which the petitioner attempted but faced portal limitations on payment amounts. The petitioner had excess input tax credit that could cover outstanding dues. The Court limited the scope of the petition to the registration cancellation issue, not delving into other defaults or opportunities for rectification. Since the cancellation order violated natural justice principles, it was set aside, directing the restoration of the GST registration immediately.

Analysis:
The judgment allowed the petition, setting aside the impugned order of 15.02.2022 and instructing the respondents to restore the petitioner's GST registration promptly. It was clarified that this decision did not prevent the respondents from taking further actions, provided they were in accordance with the law.