GST Registration Restored After Cancellation, But Penalty Imposed Despite Compliance Period Being Granted

Following the revocation of registration cancellation by the appellate authority on 26.08.2021, the petitioner was directed to file pending returns and make GST payments within 30 days. The HC confirmed the petitioner's GSTIN had been restored as recorded in the 27.04.2022 order and granted three months to upload returns. However, after restoration, the petitioner was penalized Rs.2,32,014. The HC issued notices to respondents, directing counter-affidavits within four weeks and scheduled further hearing for 27.09.2022 to address the penalty imposition following registration restoration.

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Issues involved:
1. Revocation of registration by appellate authority
2. Compliance with directions of the appellate authority
3. Imposition of penalty

Revocation of registration by appellate authority:
The petitioner's registration was initially cancelled, but the appellate authority revoked the cancellation through an order dated 26.08.2021. The appellate authority directed the petitioner to file pending returns and make payments towards GST liability within 30 days from the date of revocation. The order set aside the previous decision of the Adjudicating Authority. The petitioner approached the High Court through a writ petition as the respondents had not taken follow-up steps. During the hearing, the petitioner confirmed that its GSTIN number had been restored, as recorded in the order dated 27.04.2022. The High Court granted the petitioner three months to upload returns on the department's web portal starting from the receipt of the court's order.

Compliance with directions of the appellate authority:
The petitioner, after the restoration of its GSTIN number, was penalized with an amount of Rs.2,32,014. The High Court issued a notice to the respondents, which was accepted by the respective counsels representing them. The court directed the filing of counter-affidavits within four weeks and any rejoinders before the next hearing scheduled for 27.09.2022.

Imposition of penalty:
The petitioner raised concerns over the penalty imposed post the restoration of registration. The court acknowledged this issue and initiated the legal process by issuing notices to the respondents and setting timelines for filing necessary documents and responses. The matter was listed for further hearing to address the penalty imposition and any related legal arguments or defenses that may arise during the proceedings.

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