2025 (4) TMI 1235 - HC - GST

Challenge to order passed under section 93(1)(a) of the CGST Act 2017 - GST registration of deceased father was cancelled posthumously - petitioner obtained a fresh registration for the same proprietary concern - HELD THAT - A summons dt. 18.07.2022 was issued under section 70 to the father of the petitioner who no more was regarding non-payment of GST. The petitioner filed a reply thereto stating that his father died on 13.02.2018 and even enclosed the copy of the death certificate. He pointed out that there cannot be any proceeding initiated against a dead person after his death and requested to waive the liability. However the impugned order came to be passed on 28.11.2022 by 3rd respondent in regard to the proprietary concern of the petitioner s deceased father quoting section 93(1)(a) of the CGST Act 2017. In that order it is held that if the business is carried on by a person s legal representative after his death the legal representative would be liable to pay tax interest or penalty. But 3rd respondent did not provide details of any material evidence to show as to how the petitioner was said to be continuing business of the father s proprietary concern having himself obtained a fresh registration on 24.03.2018. In the absence of any material referred to by the said respondent as to on what basis it is held that the petitioner was continuing the business in the name of his father s proprietary concern after his father s death in spite of the petitioner obtaining a fresh registration in his own name on 24.03.2018 the impugned order dt. 28.11.2022 is perverse based on no evidence and cannot be sustained. Conclusion - The impugned order dt. 28.11.2022 is perverse based on no evidence and cannot be sustained. Petition allowed.

Summary

The Jharkhand High Court, through Chief Justice M. S. Ramachandra Rao and Justice Rajesh Shankar, allowed the writ petition challenging the order dated 28.11.2022 passed under section 93(1)(a) of the CGST Act, 2017. The petitioner's deceased father, Navtej Kumar Shangari, had a GST registration which was cancelled posthumously. The petitioner obtained a fresh registration on 24.03.2018 for the same proprietary concern. Despite this, the 3rd respondent held the petitioner liable for GST dues of the father's firm, asserting that a legal representative continuing the business is liable for tax, interest, and penalty.The Court emphasized the absence of any material evidence demonstrating that the petitioner continued the deceased's business under the old registration after obtaining a new registration. It held that "the impugned order dt. 28.11.2022 is perverse, based on no evidence and cannot be sustained." Consequently, the order was set aside, affirming that proceedings cannot be initiated against a deceased person and liability does not automatically transfer without proof of business continuation by the legal representative under the same registration.