Commissioner allows appeals for registration revocation despite delay citing COVID-19 pandemic circumstances under Section 107

The Commissioner (Appeals) CGST, Jaipur allowed appeals against rejection of registration revocation applications. The proper officer had cancelled registrations for non-filing of statutory returns for three consecutive tax periods. Although appeals were filed beyond the prescribed time limit under Section 107(1) of CGST Act 2017, the delay was condoned due to COVID-19 pandemic circumstances, citing CBIC Circular No. 157/13/2021-GST which excluded the period from 15.03.2020 to 02.10.2021 from limitation computation. The appellants had filed returns up to cancellation date, demonstrating substantial compliance with CGST provisions. The Commissioner ordered the proper officer to reconsider revocation applications after verifying tax payments, late fees, interest, penalties, and return status.

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Issues Involved:
1. Whether the appeal has been filed within the prescribed time limit.
2. Whether the appeal filed against the order of cancellation of GST registration is proper.

Detailed Analysis:

Issue 1: Timeliness of Appeal Filing
The appeals were filed under Section 107 of the CGST Act, 2017, which mandates that an appeal must be filed within three months from the date of communication of the decision or order. The appellants attributed the delay to the COVID-19 pandemic and financial difficulties. The Supreme Court, in Suo Motu Writ Petition (Civil) No.3 of 2020, extended the limitation period due to the pandemic. The CBIC Circular No. 157/13/2021-GST further clarified that such extensions apply to appeals under GST law. Given these circumstances, the delay in filing the appeals was condoned, allowing the cases to be decided on their merits.

Issue 2: Propriety of Appeal Against Cancellation of GST Registration
The Proper Officer canceled the appellants' GST registrations due to non-filing of statutory returns for three consecutive tax periods or a continuous period of six months, as per Section 29(2) of the CGST Act, 2017. Applications for revocation of cancellation were also rejected due to non-compliance with SCN or not filing within the specified time under Section 30 of the Act.

The appellants argued that due to the COVID-19 lockdown and financial constraints, they could not file returns or respond to notices timely. They have since filed all pending returns and paid the government dues. The relevant provisions under Rule 23 of the CGST Rules, 2017, and Circular No. 99/18/2019-GST were considered. These provisions stipulate that all due returns must be filed before an application for revocation can be submitted.

Upon review, it was found that the appellants had filed returns up to the date of cancellation of registration, thereby substantially complying with the CGST Act/Rules. Consequently, the appeals were allowed, and the Proper Officer was directed to consider the revocation applications after verifying the payment particulars of tax, late fee, interest, penalty, and status of returns.

Conclusion:
The appeals were disposed of with instructions to the Proper Officer to verify compliance and consider the revocation of the appellants' GST registrations.

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