2022 (7) TMI 1275 - HC - GST

Cancellation of registration of petitioner - request for revocation is not filed within the statutory limitation of 90 days - time limitation - HELD THAT - It is seen that the petitioner during the Covid-19 pandemic period had not filed his returns and thereafter, he had not conducted any business so that he filed only nil returns. Further this case is quite similar to the cases of the petitioners in TVL. SUGUNA CUTPIECE CENTER VERSUS THE APPELLATE DEPUTY COMMISSIONER (ST) (GST) , THE ASSISTANT COMMISSIONER (CIRCLE) , SALEM BAZAAR. 2022 (2) TMI 933 - MADRAS HIGH COURT . There some of the petitioner had filed an appeal beyond the period of limitation either for filing application for revocation of cancellation, while some of them had directly filed a writ petition against the order cancelling the registration. While some of them filed appeal beyond the statutory period of limitation, there was further delay in filing the writ petition. However, considering the over all facts and circumstances of the case, it was held that no useful purpose will be served by keeping those petitioners out of the Goods and Services Tax regime, as such assessee would still continue to do business and supply goods/services. The writ petition is allowed.

Summary

Issues:
1. Cancellation of GST registration due to non-filing of returns during the Covid-19 pandemic.
2. Delay in filing representation for revocation of cancellation.
3. Applicability of statutory limitation for filing revocation request.
4. Comparison with similar cases where delay was condoned.
5. Appeal remedy before the Appellate authority.
6. Consideration of reviving registration to continue business under the GST regime.

Analysis:
1. The petitioner faced cancellation of GST registration due to non-filing of returns during the Covid-19 pandemic, leading to a notice dated 04.01.2021. The petitioner's business was affected by the pandemic, resulting in failure to file returns. After discovering the cancellation in May 2022, the petitioner filed pending returns up to August 2022, including nil returns. The petitioner's attempt to file a representation for revocation was rejected due to exceeding the statutory limitation of 90 days.

2. The petitioner argued that the period from 15.03.2020 to 28.02.2022 should be excluded for computing the limitation, citing directions from the Principal Secretary/Commissioner of Commercial Taxes. Referring to a previous case where delay was condoned, the petitioner sought relief based on similar circumstances.

3. The respondents contended that the petitioner should have pursued the appeal remedy before the Appellate authority instead of directly approaching the Court. The respondents urged for the dismissal of the writ petition on this ground.

4. The Court compared the present case with similar instances where delays in filing appeals or writ petitions were observed. Despite delays, the Court recognized the importance of integrating businesses back into the GST regime to ensure compliance and revenue collection. Emphasizing the need to prevent unintended privileges, the Court decided to grant relief to the petitioners under certain safeguards.

5. Considering the overall facts and circumstances, the Court opined that reviving the registration of the petitioners would serve the purpose of maintaining tax compliance and preventing revenue loss. The Court issued specific directions for the petitioners to follow, including filing pending returns, paying outstanding taxes, and adhering to GST regulations to resume business activities legitimately.

6. The Court allowed the writ petition with the specified conditions to ensure proper compliance and integration of the petitioners back into the GST regime, emphasizing the importance of following tax laws and procedures for conducting business lawfully.