2024 (4) TMI 760 - HC - GST

Rejection of appeal - Condonation of delay in filing appeal - limitation - Cancellation of GST Registrations - Petitioner claims that due to ill-health, he could not file the returns for a period of six months - HELD THAT - The petitioner in this case is a whole seller and distributor of Airtel EC. Most of the small scale entrepreneurs like carpenters, electricians, fabricators etc. are almost uneducated and they are not accustomed with handling of e-mails and other advance technologies. Though they are providing e-mail IDs at the time of Registration, the applications are prepared by some agents by creating an e-mail IDs, however, on reality most of the Traders are not accustomed with handling of e-mails. They are also not aware about the consequences of not filing the Returns in Time. The department shall workout the possibilities of issuing these notices in the respective regional languages and also by SMS and registered post. So that, the uneducated traders can also respond to these notices to some extent. Otherwise, these notices will be an empty formality and will not serve any purpose for which it has been issued. The object of any Government is to promote the trade and not to curtail the same. The cancellation of registration certainly amounts to a capital punishment to the traders, like the petitioner. In similar circumstances, this Court, in Suguna Cutpiece Vs. Appellate Deputy Commissioner (ST) (GST) and others 2022 (2) TMI 933 - MADRAS HIGH COURT , allowed the writ petitions by holding that no useful purpose would be served by keeping the petitioners out of the Goods and Service Tax regime. By applying the above ratio, this writ petition is allowed with a direction to the respondents to permit the petitioner to pay the due amount and penalty, if any and thereafter, restore the petitioner's GST registration . No costs. Consequently, connected miscellaneous petitions are closed.

Summary

Issues Involved:
1. Appeal against cancellation of GST registration on the ground of limitation.

Summary:
The petitioner, a wholesaler and distributor of Airtel EC, registered under GST Act 2017, had his GST registration cancelled by the second respondent for not filing returns for six months. The petitioner's appeal against the cancellation was rejected by the first respondent due to limitation. The petitioner filed a writ petition challenging this decision.

The petitioner argued that the show cause notice for cancellation was issued online, and due to lack of awareness, he missed responding to it, leading to the cancellation of registration. The petitioner's livelihood was affected by the cancellation, as GSTN number is crucial for business operations.

The respondents contended that the petitioner had adequate opportunities to respond before the cancellation, and the appeal was filed after the limitation period had expired. They argued that the impugned order should not be interfered with.

The Court considered the submissions and noted that the petitioner's ill-health had prevented timely filing of returns, resulting in cancellation. Referring to a previous case, the Court emphasized the importance of allowing traders back into the GST regime for legitimate business activities.

In light of the above discussion, the Court allowed the writ petition, directing the petitioner to pay the due amount and penalty, if any, to restore the GST registration. The Court highlighted the need for notices to be issued in regional languages and through SMS for better understanding by uneducated traders. The cancellation of registration was seen as a severe penalty for traders.

Drawing from previous judgments, the Court emphasized promoting trade and commerce, leading to the decision to permit the petitioner to restore the GST registration upon payment. No costs were imposed, and connected miscellaneous petitions were closed.