Cancellation of GST Registration for Return Default Reversible if Returns Filed and Dues Cleared: Gujarat HC [Read Order]
The High Court noted that where the taxpayer is ready to regularize defaults, the purpose of cancellation under Section 29(2)(b) is to make sure that taxes are paid rather than to permanently close a corporation.
![Cancellation of GST Registration for Return Default Reversible if Returns Filed and Dues Cleared: Gujarat HC [Read Order]](https://images.taxscan.in/h-upload/2025/12/20/2113535-cancellation-of-gst-registration-return-default-reversible-returns-filed-dues-cleared-gujarat-hc-taxscan.webp "Cancellation of GST Registration for Return Default Reversible if Returns Filed and Dues Cleared: Gujarat HC [Read Order]")
The Gujarat High Court has held that cancellation of GST ( Goods and Services Tax ) registration on account of non-filing of returns is not irreversible, and that such cancellation can be revoked once the taxpayer files pending returns and clears the entire tax dues along with interest and late fees. Justice A.S. Supehia and Justice Pranav Trivedi noted that where the taxpayer...
The Gujarat High Court has held that cancellation of GST ( Goods and Services Tax ) registration on account of non-filing of returns is not irreversible, and that such cancellation can be revoked once the taxpayer files pending returns and clears the entire tax dues along with interest and late fees.
Justice A.S. Supehia and Justice Pranav Trivedi noted that where the taxpayer is ready to regularize defaults, the purpose of cancellation under Section 29(2)(b) is to make sure that taxes are paid rather than to permanently close a corporation.
The fact is that the Petitioner - M/s Durga Gopal Shinde’s GST registration was cancelled by the department under Section 29(2)(b) of the CGST/Gujarat SGST Act, stating failure to file GST returns for the prescribed period.
The cancellation order dated 20 September 2022 was issued with retrospective effect from 1 April 2022, following a show cause notice issued earlier.
Aggrieved by the cancellation and rejection of restoration in appeal, the petitioner approached the High Court seeking revocation of registration.
Before the Court, the petitioner submitted that although there was a default in filing returns, the entire tax liability for the period from April 2022 to December 2024 had already been self-assessed and fully discharged.
It was placed on record that the petitioner had deposited a total amount of ₹16.12 lakh in the Electronic Cash Ledger, which included tax dues, interest, and late fees, and expressed readiness to file all pending returns immediately.
The State authorities, on instructions from the assessing officer, confirmed that the petitioner had indeed deposited the tax amount along with applicable interest and late fees in terms of Section 49 of the GST Act read with Rule 87 of the Gujarat SGST Rules.
The department submitted that if the petitioner is permitted to file the pending returns, the same would be processed in accordance with law, and any further liability, if found payable, would have to be cleared by the petitioner.
The Court held that since the petitioner had already deposited the entire outstanding amount “as if the returns were duly filed,” denial of an opportunity to restore registration would be unjustified.
Accordingly, the Court permitted the petitioner to file all pending GST returns. It directed that if, upon scrutiny, any additional demand arises, the petitioner must pay the same forthwith. Upon such compliance, the order cancelling the GST registration shall stand revoked, restoring the registration of the taxpayer.
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