2023 (1) TMI 902 - HC - GST

Conditions of delay in filing appeal before the first Appellate Authority - Appeal belated by two years and one month - person concerned looking after the affairs of the company, had passed away - Cancellation of registration of petitioner company - HELD THAT - There has been no calculation of the tax even after filing of SCN. This when came to the notice of the petitioner, the time had already lapsed for filing the appeal and as per section 107, since 30 days had already lapsed, the petitioner company could not upload the application on the common portal seeking revocation application in Form GST REG 21 and, manually, it was not permissible. The order of appellate authority has come, which says that the authority, if is satisfied that the appellant was prevented by sufficient cause from presenting the appeal within the period of three months or six months as the case may be, it can further allow the period of one month to be condoned. However, the appeal was belated by two years and one month and, hence, it is not empowered to condone the delay, even when there is justifiable cause as in the instant case as the person concerned looking after the affairs of the company, had passed away, nobody else was deputed and the email had gone into spam folder. It is to be noted that the decision of AGGARWAL DYEING AND PRINTING WORKS VERSUS STATE OF GUJARAT 2 OTHER (S) 2022 (4) TMI 864 - GUJARAT HIGH COURT rendered by this Court is subsequent to the filing of issuance of show cause notice as also the order of cancellation of registration. Therefore, what needs to be done is to quash and set aside the impugned order of the authority concerned for it to issue the show cause notice with requisite details and after following due procedure of law, it shall determine the same. The order of the appellate authority is also quashed. The cancellation of registration is revoked. The show cause notice dated 24.05.2019 issued under Rule 22 of the Rules is also quashed and set aside - petition allowed.

Summary

Issues:
Challenge to order canceling registration under Central Goods and Services Tax Act, 2017.

Analysis:
1. The petitioner sought to quash the order canceling their registration under the Central Goods and Services Tax Act, 2017, due to the unwellness and subsequent passing away of the person handling the company's affairs, leading to a failure in responding to a show cause notice.

2. The petitioner argued that they were not able to upload returns due to system restrictions after December 2018, and the cancellation notice was not received in time, resulting in the inability to file an appeal within the stipulated period.

3. The court noted the importance of reasons in administrative orders, emphasizing that the absence of reasons can lead to a denial of a reasonable opportunity of hearing, thus affecting the principles of natural justice. The decision highlighted the need for clear and cogent reasons to be provided in support of conclusions, as reasons are considered the heart and soul of any decision.

4. Referring to previous legal precedents, the court emphasized the significance of adherence to procedural requirements and principles of natural justice in matters of registration, cancellation, and revocation under the Act. The judgment underscored the importance of transparency, accountability, and the necessity for reasoned decisions in the administrative and judicial processes.

5. Ultimately, the court allowed the petition, quashing the cancellation order and revoking the registration cancellation. The show cause notice was also set aside, with a directive for the authority to issue a new notice with detailed grounds and following due procedure. The decision aimed to ensure fairness, adherence to legal principles, and the protection of the petitioner's rights in the administrative process.