Gauhati HC Allows 2 months time to seeking Restoration of GST Registration Cancelled [Read Order]

The Gauhati High Court allowed the 2 months time to seek restoration of Goods and Service Tax ( GST ) registration which got cancelled due to non filing of GST return for a continuous period of 6 months.

D.D. Construction , the petitioner that it is an assessee registered under the provisions of the Central Goods and Services Tax (CGST) Act, 2017/Assam Goods and Services Tax (AGST) Act, 2017 bearing registration no. 18AALFD2009F1ZQ and because of non-filing of GST returns for a continuous period of six months, the petitioner was served with a show cause notice bearing reference no. ZA181123011635X dated 14.11.2023 asking it to furnish reply to the aforesaid notice within a period 30 (thirty) days from the date of service of notice.

It was mentioned in the aforesaid show cause notice that if the petitioner fails to furnish a reply within the stipulated date or fail to appear for personal hearing on the appointed date and time, the case will be decided ex parte on the basis of the available records and on merits. However, the date for the personal hearing was notified on 12.12.2023. Thereafter, the impugned order dated 20.02.2024 was issued by the Superintendent, Naharkatia-respondent No.4, cancelling GST registration of the petitioner for not furnishing returns for a continuous period of 6 (six) or more months.

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Thereafter, the petitioner tried to file the necessary application seeking revocation of GST cancellation, however, the same could not be filed as the time limit prescribed for filing of revocation application was elapsed.

Shri Agarwal, counsel appearing for the petitioner has submitted that due to reasons beyond his control, the petitioner could not submit the returns required to be submitted under Section 39(1) of the CGST Act, 2017 for a period of about 6 (six) months or more. However, he has submitted that the petitioner is ready and willing to comply with all the formalities required as per proviso to sub-rule (4) of Rule 22 of the CGST Rules, 2017.

As per Section 29(2)(c), an officer, duly empowered, may cancel the GST registration of a person from such date, including any retrospective date, as he deems fit, where any registered person has not furnished returns for a continuous period of 6 (six) months. Rule 22 of the CGST Rules, 2017 has laid down the procedure for cancellation of the registration.

It is discernible from a reading of the proviso to sub-rule (4) of Rule 22 of the CGST Rules 2017 that if a person, who has been served with a show cause notice under Section 29(2)(c) of the CGST Act, 2017, is ready and willing to furnish all the pending returns and to make full payment of the tax itself along with applicable interest and late fee, the officer, duly empowered, can drop the proceedings and pass an order in the prescribed Form i.e. Form GST REG-20.

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The GST registration of the petitioner has been cancelled under Section 29(2)(c) of the CGST Act, 2017 for the reason that the petitioner did not submit returns for a period of 6 (six) months and more; and the provisions contained in the proviso to sub-rule (4) of Rule 22 of the CGST Rules, 2017 and cancellation of registration entails serious civil consequences.

The Court is of the considered view that in the event the petitioner approaches the officer, duly empowered, by furnishing all the pending returns and make full payment of the tax dues, along with applicable interest and late fee, the officer duly empowered, has the authority and jurisdiction to drop the proceedings and pass an order in the prescribed Form.

A single bench of Justice Sanjay Kumar Medhi disposed of the writ petition by providing that the petitioner shall approach the concerned authority within a period of 2 months from today seeking restoration of his GST registration.

If the petitioner submits such an application and complies with all the requirements as provided in the proviso to sub-rule (4) of Rule 22 of the CGST Rules, 2017, the concerned authority shall consider the application of the petitioner for restoration of his GST registration in accordance with law and shall take necessary steps for restoration of GST registration of the petitioner as expeditiously as possible.

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