Court allowed revocation of cancelled GST Reg. after expiry of statutory limitation of time

Sep 5, 2022 | Blog | 0 comments

Court allowed the Writ petition for revocation of Cancelled GST registration which was not filed within the statutory period;

Facts: The petitioner filed the writ petition for the revoke the the cancellation of registration. The petitioner used to purchase materials from both registered and unregistered dealers and the same were used in the execution of works contract. Further, the petitioner engaged private consultant for the purpose of filing the returns. The petitioner used to furnish all the invoice, purchase and sales transaction, monthly GSTR-3B within the due dates. During the period, the petitioner health was not good and he had undergone surgery and bed rest for several months that’s why the consultant didn’t filed the return. GST Authorities cancel the GSTIN registration of the petitioner in the month of July 2022.

The petitioner filed a representation to revoke the cancellation of registration but the same was no accepted on the ground of revocation is not filed within the statutory period of 90 days.

Petitioner Contention: Petitioner submitted before the authorities that the Apex court dated 07.04.2022 has directed the authorities to exclude the period from 15.03.2020 to 28.02.2022 for the purpose of computing the limitation. Further, the petitioner relied upon the several case law where the court condoned the delay. He relied on the decision passed by the court in the case of Tvl.Suguna Cutpiece Vs Appellate Deputy Commissioner (ST) (GST) and others (W.P.Nos.25048, 25877, 12738 of 2021 etc. batch), dated 31.01.2022, wherein, this Court condoned the delay.

Court Held: Considering the contention raised by the petitioner, the court held that restoring the registration would not cause any harm to the department on the other hand it would be beneficial for the state to earn revenue.

Further, the court relied upon the decision passed by the court in the case of TVl.Suguna Cutpiece Vs Appellate Deputy Commissioner (ST) (GST) and others (W.P.Nos. 25048, 25877, 12738 of 2021 etc.. batch), dated 31.01.2022, wherein some of the petitioner filed an appeal beyond the period of limitation either for filing application for revocation of cancellation, while some of them had directly filed a writ petition against the order cancelling the registration. While some of them filed appeal beyond the statutory period of limitation, there was further delay in filing the writ petition.

However, considering the overall facts and circumstances of the case, the court held in this case that “no useful purpose will be served by keeping those petitioners out of the Goods and Services Tax regime, as such assesse would still continue to do business and supply goods/services. By not bringing them back to the Goods and Services Tax fold/regime, would not further the interest of the revenue”

With regard to the above submission and case law cited by petitioner the court directed the petitioner

  1. to file their returns for the period prior to the cancellation of registration, if such returns have not been already filed,
  2. to not deduct the Interest, fine from any out of any ITC which may be unutilized,
  3. any ITC is utilized, then it shall not be utilised until it is scrutinized and approved by the department.
  4. Petitioner shall pay the GST and file the returns for period subsequent to the cancellation of registration.
  5. The respondent shall take suitable steps by instructing GST Network, New Delhi to make suitable changes in the architecture of the GST web portal to allow these petitioners to file their returns and to pay the tax/penalty/Fine.

If you have also received the same kind of SCN regarding the cancellation of GST registration, then in such scenario you should reply the SCN reply with as many evidence that you have. If the SCN replied has not been replied and order is being issued, then filed the appeal against such revocation order and if the appeal order doesn’t come in the favour of the assesse then you can go the the High Court in Writ.

Please feel free to reach out to us: info@cretumadvisory.com

Citation: 2022 (8) TMI 1175 – MADRAS HIGH COURT

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