GST Registration Cancelled due to Non-Filing of Returns: Gauhati HC Allows Restoration Upon Clearing Dues [Read Order]
The Court noted that under Rule 22(4) of the CGST Rules, if dues and returns are cleared, cancellation proceedings can be dropped.
GSt - registration - Taxscan
GSt - registration - Taxscan
The High Court of Gauhati, allowed restoration of Goods and Service Tax (GST) registration that was cancelled for non-filing of returns, after the petitioner cleared all dues and filed pending returns.
Abdur Rofique,petitioner-assessee, was running a proprietorship under the name “A. R. Electrical Enterprises” and was registered under the CGST/AGST Acts. His GST registration was cancelled through an order dated 18.07.2023 for not filing returns for over six months. Although a show cause notice was issued earlier, no date for personal hearing was given.
The petitioner stated he was unwell and could not respond to the notice or file returns in time. After recovering, he filed all pending returns up to July 2023 and paid the dues, including late fees and interest. However, his attempt to apply for revocation failed as the 270-day time limit had already lapsed. He then approached the Court seeking relief.
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The assessee counsel submitted that the petitioner was willing to meet all requirements under Rule 22(4) of the CGST Rules, including filing pending returns and clearing dues with interest and late fees.
As per Section 29(2)(c) of the CGST Act, GST registration could be cancelled if returns were not filed for six months. Rule 22 laid down the procedure, allowing cancellation through a show cause notice. However, if the taxpayer later filed all pending returns and paid dues, the officer could drop the cancellation proceedings and restore the registration.
The Court noted that the petitioner met these conditions and referred to a similar case (Sanjoy Nath v. Union of India), where relief was granted under the same rule.
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Justice Sanjay Kumar Medhi noted that the petitioner’s GST registration was cancelled for not filing returns for over six months. Since cancellation had serious consequences, and Rule 22(4) allowed restoration if returns and dues were cleared, the Court held that the officer could drop the proceedings if the petitioner met these conditions.
The bench directed the petitioner to apply for restoration within two months. If all pending returns were filed and dues paid, the officer was to decide on the application within 60 days.
It also stated that the time limit under Section 73(10) would count from the date of this order, except for FY 2024-25, which would follow Section 44. The petitioner remained responsible for paying any pending tax, interest, penalty, and late fees.
The writ petition was disposed of.
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