Penalty Cannot be levied for Late Filing of GST Returns during Cancellation of GSTIN: Delhi HC [Read Order]
![Penalty Cannot be levied for Late Filing of GST Returns during Cancellation of GSTIN: Delhi HC [Read Order]](https://www.taxscan.in/wp-content/uploads/2023/03/Penalty-Late-Filing-of-GST-Returns-Cancellation-of-GSTIN-Delhi-HC-Taxscan.jpg "Penalty Cannot be levied for Late Filing of GST Returns during Cancellation of GSTIN: Delhi HC [Read Order]")
In a recent ruling, the division bench of Delhi High Court (HC) presided by Justices Vibhu Bakhru and Amit Mahajan observed that from the date of the petitioner filing an application for revocation of its cancellation, he cannot be held responsible for not filing its returns during the period when the registration stood cancelled. Thus, the bench held that penalty cannot be levied for...
In a recent ruling, the division bench of Delhi High Court (HC) presided by Justices Vibhu Bakhru and Amit Mahajan observed that from the date of the petitioner filing an application for revocation of its cancellation, he cannot be held responsible for not filing its returns during the period when the registration stood cancelled.
Thus, the bench held that penalty cannot be levied for late filing of the Goods and Services Tax (GST) Returns during the cancellation of GSTIN.
The petitioner, Ishwar Chand, Proprietor of M/s Bhagwati Trading Co. filed the petition before the HC praying to set aside the penalty imposed of ₹2,32,014. He has not filed its GST returns for a period of more than six months, resulting in the respondents issuing a Show Cause Notice.
The said Show Cause Notice is not on record. However, it does appear from the subsequent orders that the reason for issuing the Show Cause Notice was precisely what is stated above – the petitioner has not filed its returns for a period of six months.
The respondent's counsel contended that the petitioner independently calculated the figure of ₹2,32,014 and there was no demand for a penalty had been made.
However the petitioner submitted that the respondent authority issued a Show Cause Notice proposing to reject the petitioner’s application for revocation of the cancellation of the GSTIN registration on the reason that it lacks the reason for the revocation.
The issue in the current case concerns the imposition of a fine for filing GST returns after the deadline during the time the petitioner was prevented from doing so due to the revocation of its GSTIN registration.
The bench observed that the order of the respondent authority rejecting the application of GSTIN registration is unsustainable as it does not provide any proper reason for the rejection.
To Read the full text of the Order CLICK HERE
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