Chartered Accountant's Technical Error in GST Registration Leads to Cancellation; Court Orders Restoration of Original CGST Registration

The HC addressed a case where GST registration was cancelled due to an inadvertent error by a Chartered Accountant who inserted a proprietary ship's registration number instead of the HUF registration number. Despite the cancellation, tax returns continued to be accepted. Recognizing this was a technical mistake rather than deliberate non-compliance, the court directed the tax authority to recall the cancellation order and restore the original CGST registration within eight weeks. The court emphasized that dealers should not face severe penalties for unintentional errors made by their representatives.

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Issues:
1. Cancellation of GST registration certificate due to an inadvertent mistake by the Chartered Accountant leading to the registration number of the proprietary ship being inserted instead of the HUF registration number.
2. Acceptance of returns despite the cancellation of registration.
3. Relief sought by the writ applicants for quashing the cancellation order, refund of tax paid, and restoration of registration certificate.
4. Court's direction to respondent No.2 to recall the cancellation order and restore the original registration under the CGST within eight weeks.

Analysis:
1. The writ applicants approached the court seeking relief under Article 226 of the Constitution of India to quash the order cancelling their registration certificate. The inadvertent mistake made by the Chartered Accountant led to the insertion of the proprietary ship's registration number instead of the HUF registration number, resulting in the cancellation of the GST registration. Despite this, the returns filed by the applicants were still being accepted, indicating a discrepancy in the system.

2. The court acknowledged the peculiar circumstances of the case and issued a notice to the respondents, directing them to look into the matter. The court emphasized that the cancellation of registration due to a mistake by the Chartered Accountant should not impose a heavy penalty on the dealer under the Act. The court highlighted the need for prompt action to recall the cancellation order and restore the original registration under the CGST.

3. In response to the arguments presented by both parties, the court directed respondent No.2 to take necessary steps to rectify the error within eight weeks from the date of the judgment. The court disposed of the writ application accordingly, permitting direct service of the order and instructing the learned AGP to communicate the decision to the relevant authority for immediate action.

This judgment showcases the court's consideration of the unintentional error leading to the cancellation of the registration certificate and emphasizes the importance of rectifying such mistakes promptly to prevent undue hardship on the dealer. The court's decision to direct the restoration of the original registration under the CGST reflects a balanced approach to address the issue effectively.

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