2024 (12) TMI 579 - HC - GST

Cancellation of GST registration due to failure to furnish bank details - Rule 21 (d) read with Rule 10A of the Central Goods and Service Tax Act 2017 the petitioner had not furnished the bank details - HELD THAT - There cannot be a dispute that respondent no. 3-appellate authority has no power to condone the delay beyond the stipulated time in an appeal under Section 107 of the G.S.T. Act. The petitioner s stand that soon after the show cause notice was received its chairman died as a ground for belated filing of the appeal is a plausible one. The fact remains that there was delay which respondent no. 3-appellate authority had no power and jurisdiction to condone. The division benches of this Court in such peculiar state of affairs noticing that absence of any power in the appellate authority to condone the delay even in genuine cases would result in obstruction of the fundamental right guaranteed by the constitution to carry on the business under Article 19 (1) (g) have intervened in appropriate cases. In the matter of ROHIT ENTERPRISES VERSUS THE COMMISSIONER STATE GST AURANGABAD. THE DY. COMMISSIONER STATE TAX (APPEAL) AURANGABAD. THE STATE TAX OFFICER AURANGABAD 2023 (2) TMI 759 - BOMBAY HIGH COURT it has been demonstrated as to how cancellation of G.S.T. registration would even adversely affect the revenue of the State expected such matters to be approached pragmatically. Following MAFATLAL INDUSTRIES LTD. VERSUS UNION OF INDIA 1996 (12) TMI 50 - SUPREME COURT inter alia observing that the jurisdiction of the High Court under Article 226 of the Constitution of India cannot be restricted by the provision of any Act to bar or curtail remedies had entertained the petition particularly in light of the fact that the order of cancellation of registration on technicalities could be reconsidered. The impugned order of respondent no. 4 dated 13.06.2023 is quashed and set aside - Petition allowed.

Summary

Issues:
Cancellation of GST registration due to failure to furnish bank details, appellate authority's power to condone delay in appeals under Section 107 of the GST Act.

Analysis:
The petitioner, a business supplying labor, challenged the cancellation of its GST registration by respondent no. 4 for not providing bank details as required by Rule 21 (d) read with Rule 10A of the Central Goods and Service Tax Act, 2017. The petitioner's chairman's death led to a delay in responding to the show cause notice, resulting in a delayed appeal before the appellate authority. The petitioner argued that the appellate authority lacked the power to condone such delays, affecting the fundamental right to carry on business under Article 19 (1) (g) of the Constitution of India.

The respondent, through the learned A.G.P., contended that the appellate authority could not entertain the appeal due to the absence of statutory power to condone delays. Citing previous decisions of the High Court, the respondent argued that the registration cancellation was lawful as the bank details were not furnished, a fact acknowledged by the petitioner's advocate.

The High Court considered both arguments and noted the absence of power for the appellate authority to condone delays beyond the stipulated time under Section 107 of the GST Act. While acknowledging the petitioner's plausible reason for the delay, the Court emphasized the appellate authority's lack of jurisdiction to condone delays. The Court referenced previous cases where the High Court intervened to protect the fundamental right to carry on business under Article 19 (1) (g) when faced with similar situations.

Ultimately, the High Court allowed the writ petition, quashed the cancellation order, and directed the petitioner to appear before respondent no. 4 to reply to the show cause notice and furnish bank details for a fresh decision in accordance with the law. The Court clarified that its decision did not touch upon the merits of the case.