GST Registration Cancellation Overturned: Court Protects Taxpayer Rights Despite Delayed Appeal Under Section 107(1)

The HC set aside the cancellation of petitioner's GST registration and the dismissal of appeal for exceeding limitation period. While acknowledging that delay beyond the extended one-month period cannot technically be condoned under Section 107(1) of CGST Act, the court expressed concern about the severe impact on the petitioner, especially with no GST Tribunal available as remedy. The matter was remanded to the authority for reconsideration, with direction to the petitioner to file all required returns during this process. The writ petition was disposed of without costs.

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Issues:
Cancellation of GST registration due to non-filing of returns, Appeal filed beyond the extended period of limitation under Section 107(1) of the Central Goods and Services Tax Act, 2017.

Analysis:
The petitioner's GST registration was canceled by respondent No.3 due to non-filing of returns for six months. The appeal filed by the petitioner was dismissed by respondent No.2 citing that the appeal was filed beyond the extended period of limitation under Section 107(1) of the CGST Act. The court noted that a similar issue was addressed in a previous decision of the court. The court highlighted the provisions of Section 107(1) and (4) of the CGST Act regarding the limitation for filing an appeal and the authority's discretion to allow further time for appeal submission with sufficient cause shown by the appellant.

The court acknowledged that the delay beyond the extended period of one month cannot be condoned, but expressed concerns that such a strict stance may adversely affect the petitioner, especially considering the absence of a GST Tribunal as a remedy. The court emphasized that the cancellation of GST registration is a crucial issue in the case. Consequently, the court decided to remand the matter back to respondent No.2 for reconsideration and to pass an appropriate order in accordance with the law. The court directed the petitioner to submit all the required returns as per the statute during the reconsideration process.

In conclusion, the court set aside the previous orders related to the cancellation of GST registration and the dismissal of the appeal, remanding the matter back to respondent No.3 for reevaluation. The court emphasized the importance of addressing the petitioner's grievance regarding the cancellation of GST registration and instructed the petitioner to comply with statutory return submissions during the reconsideration. The writ petition was disposed of without any order as to costs, and pending miscellaneous applications were closed.

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