GST registration revocation must follow statutory compliance; arbitrary cancellation fails where returns are filed and no dues remain.

GST registration cancellation can be sustained only on statutory grounds, and revocation must follow the prescribed procedure, including filing pending returns and clearing dues. On the record, the assessee had complied, and the Department itself confirmed filing of GSTR-3B returns up to November 2019 with no outstanding tax liability for that period. The cancellation and rejection of revocation were therefore found arbitrary because the authorities failed to verify their own records and proceeded on an unsustainable view that the facts could not be checked at that stage. The cancellation and appellate orders were set aside, and revocation of registration was directed to be allowed.

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Issues: Whether the orders cancelling the GST registration and rejecting revocation were liable to be set aside where the returns had been filed and no tax dues remained outstanding.

Analysis: Cancellation of registration under the GST regime is permissible only on the statutory grounds and revocation is governed by the prescribed procedure. The proviso to the revocation rule required the assessee to furnish the pending returns and clear the tax, interest, penalty, and late fee dues. On the record, the assessee had asserted compliance, and the Department later confirmed that GSTR-3B had been filed upto November 2019 and that no dues were pending upto that period. The rejection orders were found to be arbitrary because the Department failed to verify its own records and the appellate authority proceeded on an unsustainable view that the facts could not be verified at that stage.

Conclusion: The cancellation and appellate orders were set aside and the application for revocation of registration was directed to be allowed.

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