2024 (7) TMI 1447 - HC - GST

Cancellation of the petitioner's GST registration - failure to file returns in time on account of ill-health - HELD THAT - The appellate authority cannot be faulted for rejecting the appeal in view of the language of Section 107 of the Central Goods and Services Tax Act, 2017. At the same time, the petitioner should not be left without remedy. In Suguna Cutpiece v. The Appellate Deputy Commissioner (ST)(GST) and others, 2022 (2) TMI 933 - MADRAS HIGH COURT , this Court directed restoration of registration subject to certain conditions. In the over all facts and circumstances, the petitioner is entitled to an order on similar lines. The petitioner is directed to file returns for the period prior to the cancellation of registration, together with tax dues along with interest thereon and the fee fixed for belated filing of returns within a period of forty five (45) days from the date of receipt of a copy of this order - petition disposed off.

Summary

Issues:
1. Appeal against cancellation of GST registration.
2. Rejection of appeal as time-barred.
3. Restoration of GST registration subject to conditions.

Analysis:
The petitioner challenged an appellate order rejecting the appeal against the cancellation of their GST registration and the subsequent cancellation order due to the proprietor's inability to file returns on time because of ill-health. A show cause notice was issued, followed by the cancellation order after the appeal was rejected as time-barred. The petitioner contended that without the restoration of registration, they had no recourse but to approach the court. The petitioner cited the judgment in Suguna Cutpiece case to support the restoration of registration.

The Additional Government Pleader acknowledged the judgment in Suguna Cutpiece as a conditional order and emphasized the need for the petitioner to comply with all stipulated conditions. The court noted that the appellate authority was justified in rejecting the appeal based on the provisions of Section 107 of the Central Goods and Services Tax Act, 2017, but recognized the petitioner's right to a remedy. Drawing parallels with the Suguna Cutpiece case, the court directed the restoration of registration for the petitioner, subject to specific conditions.

The court issued detailed directions for the restoration of GST registration, including the filing of returns for the period before and after the cancellation, payment of tax dues, interest, and fees within specified timelines, and restrictions on utilizing unclaimed Input Tax Credit without approval. The court also mandated scrutiny and approval of any unutilized Input Tax Credit by the competent authority before utilization for future tax liabilities. Furthermore, the respondents were instructed to facilitate the petitioner's compliance by making necessary changes to the GST Web portal within a stipulated timeframe.

The restoration of GST registration was contingent upon the petitioner fulfilling all prescribed conditions. The court disposed of the writ petition with the outlined directions, emphasizing that the restoration was subject to compliance. No costs were awarded, and the connected miscellaneous petition was closed as a result of the judgment.