2021 (8) TMI 915 - HC - GST

Cancellation of registration of petitioner - suppression of facts or not - reasons to believe - HELD THAT - The core provision of Section 67 is that the proper officer has to have reasons to believe that the taxable person has suppressed any transaction - In the instant case, because of the aforementioned circumstance, it is an admitted position of the petitioner as well as the respondents that the petitioner assessee is unable to submit his returns as well as to pay the taxes for the period subsequent to January, 2018 as because the earlier issue raised in M/S RAMKY TK JV VERSUS THE UNION OF INDIA AND 4 ORS. REP BY THE COMMISSIONER AND SECRETARY TO THE GOVT. OF INDIA, MINISTRY OF FINANCE, THE COMMISSIONER OF STATE TAXES KAR BHAWAN GANESHGURI, THE COMMISSIONER OF CENTRAL GST GST BHAWAN KEDAR ROAD, COMMERCIAL TAX OFFICER (EARLIER KNOWN AS THE SUPERINTENDENT OF TAXES) , COMMERCIAL TAX OFFICER (EARLIER KNOWN AS THE SUPERINTENDENT OF TAXES) 2020 (10) TMI 1271 - GAUHATI HIGH COURT has not been adjudicated. The issue raised in this writ petition is intricately connected with the issue mentioned in the case above and a decision therein would determine the rights of the parties as regards the issue raised in this writ petition. The circumstance narrated above gives a prima-facie indication that it cannot be an independent cause of action beyond the issue raised in the said order, which requires a separate consideration of its own. List the matter immediately on the expiry of two weeks.

Summary

Issues:
1. Delay in restoring registration under GST law leading to inability to submit returns and pay taxes.
2. Notice issued by CGST Department under Section 70 of the Central Goods and Service Tax Act, 2017.

Analysis:
1. The petitioner, an assessee under GST law, faced registration cancellation due to an error in submitting returns for January 2018. Despite an interim order staying the cancellation, the registration was not restored by the SGST authorities, hindering the petitioner from fulfilling subsequent tax obligations through the online portal. The pending WP(C) No.3767/2020 addresses this issue, emphasizing the critical need for a swift resolution to reinstate registration for tax compliance.

2. The issuance of notices dated 20.07.2021 and 28.07.2021 by the CGST Department, invoking Section 70 of the CGST Act, 2017, raises concerns. Section 67 outlines the conditions for summoning a person to provide evidence or documents, requiring the proper officer to have reasons to believe that the taxable person has suppressed transactions. The petitioner's inability to meet post-January 2018 tax obligations due to unresolved issues from WP(C) No.3767/2020 highlights the interconnected nature of the legal challenges faced.

3. The High Court acknowledged the intertwined nature of the issues raised in both the present writ petition and WP(C) No.3767/2020. The court emphasized the need for a holistic consideration, noting that the resolution of the pending WP(C) No.3767/2020 would significantly impact the rights and obligations of the parties involved. The court directed the listing of both cases together for comprehensive adjudication, requiring all parties to submit affidavits before the next hearing for a final determination on the matters at hand.

4. In light of the complexities surrounding the registration restoration, tax payment obligations, and the legal implications of the notices issued by the CGST Department, the High Court scheduled a final consideration of the issues after two weeks. The court instructed that the impugned notices should not be enforced until the next hearing, emphasizing the need for a prompt resolution to address the petitioner's grievances and ensure compliance with GST laws.