Delhi HC Orders Restoration of GST Registration, Rejects Suspension Based on Rule 86B Non-Compliance [Read Order]
The court rejected the suspension, finding that the petitioner had complied with the rule by making the necessary payment, and ruled that the suspension was not justified based on this ground alone
![Delhi HC Orders Restoration of GST Registration, Rejects Suspension Based on Rule 86B Non-Compliance [Read Order]](https://www.taxscan.in/wp-content/uploads/2024/10/Delhi-High-Court-GST-GST-Registration-Rule-86B-of-CGST-Rule-Delhi-HC-Orders-Restoration-Rule-86B-non-compliance-suspension-rejected-taxscan.jpg "Delhi HC Orders Restoration of GST Registration, Rejects Suspension Based on Rule 86B Non-Compliance [Read Order]")
In a recent case,the Delhi High Court ordered the restoration of the Goods and Service Tax ( GST ) registration of petitioner, whose business, "Shri Salasar Balaji Steel," had faced suspension due to alleged non-compliance with Rule 86B of the Central Goods and Service Tax ( CGST ) Rules Ujjwal Garg,the petitioner-assessee filed a petition seeking the restoration of his GST registration...
In a recent case,the Delhi High Court ordered the restoration of the Goods and Service Tax ( GST ) registration of petitioner, whose business, "Shri Salasar Balaji Steel," had faced suspension due to alleged non-compliance with Rule 86B of the Central Goods and Service Tax ( CGST ) Rules
Ujjwal Garg,the petitioner-assessee filed a petition seeking the restoration of his GST registration under the trade name "Shri Salasar Balaji Steel," which had been suspended following a Show Cause Notice ( SCN ) issued on August 14, 2024. The SCN cited a violation of Rule 86B of the CGST Rules, which restricted the use of input tax credit ( ITC ) for discharging tax liability.
Complete Supreme Court Judgment on GST from 2017 to 2024 with Free E-Book Access, Click here
In response to the SCN, the petitioner submitted a reply and enclosed a challan reflecting a payment of ₹80,000, arguing that this payment satisfied the requirement of paying at least 1% of the liability on outward supplies.
The respondents contended that the petitioner did not follow the proper procedure by filing the requisite form ( FORM DRC-03 ) for the payment. They also claimed that the petitioner’s name was included in a list of fake firms, a point that was not mentioned in the SCN.
The petitioner’s GST registration was suspended with effect from the date of the SCN, which caused significant disruptions to his business operations.
Complete Supreme Court Judgment on GST from 2017 to 2024 with Free E-Book Access, Click here
During the proceedings, the court observed the serious implications of GST registration suspension on the petitioner’s business. The court pointed out that such an action should only be taken after due consideration and clear grounds for doing so. Since the only allegation in the SCN was related to non-compliance with Rule 86B, which had been remedied by the petitioner’s payment, the court deemed the suspension unjustified.
Ultimately, the court ordered the immediate restoration of the petitioner’s GST registration, asserting that the respondents could still initiate any necessary proceedings or actions for statutory violations or recovery of dues in accordance with the law.
Complete Supreme Court Judgment on GST from 2017 to 2024 with Free E-Book Access, Click here
A coram of Vibhu Bakhru ( Justice ) and Sachin Datta ( Justice ) disposed of the petition in favour of the petitioner allowing him to resume his business activities without further delay.
To Read the full text of the Order CLICK HERE
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