2024 (7) TMI 249 - HC - GST

Cancellation of petitioner s GST registration - petitioner had not filed any Return for a period in dispute - petitioner has neither replied to the show cause notices nor participated in the personal hearings - HELD THAT - This Court is of the view that the petitioner has made out the case for interference with the impugned orders as there is a contradiction. Since the petitioner's registration was cancelled on 08.01.2019, the question of the petitioner filing the Return in GST DRC 3B cannot be countenanced. It appears that since the petitioner has neither also replied to the show cause notices nor participated in the personal hearings. This Court is, therefore, of the view that the matter deserves to be remitted back to the respondent to pass fresh orders on merits - Considering the fact that the petitioner may have had outward supply of goods during the period in dispute, as a condition for hearing the case afresh, the petitioner shall deposit 10% of the disputed tax under the respective Writ Petitions in cash or through Electronic Cash Register, if the same is accessible. The impugned orders, which stand quashed shall be treated as addendum to the respective show cause notices that preceded the impugned orders - Petition disposed off.

Issues involved:
1. Cancellation of GST registration.
2. Non-filing of returns.
3. Application of Rule 30 of GST Rules.
4. Non-application of mind in impugned orders.
5. Time-barred Writ Petitions.
6. Interference with impugned orders.
7. Remittance of matter back to respondent for fresh orders.
8. Deposit of disputed tax.
9. Expectation of fair orders from respondent.

Analysis:

1. Cancellation of GST registration:
The petitioner's GST registration was cancelled on 08.01.2019 with effect from 20.08.2017 due to non-filing of returns. The cancellation was pursuant to a show cause notice issued under Rule 22(1) of TNGST Act, 2017. The petitioner had not renewed the registration after its cancellation.

2. Non-filing of returns:
The petitioner had not filed any return for the disputed period, leading to the cancellation of registration. The Department relied on GSTR-3B and GSTR 2A, which showed inward supply of goods by third-party suppliers. The petitioner had not filed returns in GST DRC 01 or GSTR-3B for the respective assessment years.

3. Application of Rule 30 of GST Rules:
The Department applied Rule 30 of the GST Rules and confirmed the tax by adding 110% to the inward value of supply in the auto-populated ITC in GSTR-2A. The petitioner argued that this decision was made without considering the non-filing of returns by the petitioner.

4. Non-application of mind in impugned orders:
The petitioner claimed a lack of application of mind in the impugned orders. However, it was acknowledged that the petitioner did not reply to the show cause notice or participate in the personal hearing due to the cancellation of registration.

5. Time-barred Writ Petitions:
The Government Advocate argued that the Writ Petitions were time-barred, citing a Supreme Court decision. The period for filing statutory appeal was also deemed time-barred, as per the TNGST Act, 2017.

6. Interference with impugned orders:
The Court found a contradiction in the impugned orders and concluded that the petitioner's registration being cancelled meant the filing of returns could not be considered. The Court decided to remit the matter back to the respondent for fresh orders.

7. Remittance of matter back to respondent for fresh orders:
The Court directed the respondent to pass fresh orders on merits. The petitioner was required to deposit 10% of the disputed tax under the respective Writ Petitions within a specified time frame.

8. Deposit of disputed tax:
The petitioner was instructed to deposit the disputed tax amount along with replies to the show cause notices within 30 days. The deposit could be made in cash or through an Electronic Cash Register.

9. Expectation of fair orders from respondent:
The Court expected the respondent to pass fair orders on merits and in accordance with the law expeditiously, preferably within two months. The petitioner was to be given a hearing before the order in the demand proceedings.

In conclusion, the Court disposed of the Writ Petitions with the outlined directions, emphasizing no costs were to be incurred. The connected miscellaneous petitions were also closed as a result.

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