2022 (7) TMI 1226 - HC - GST

GST Registration Revival Granted Despite Limitation Period: Non-Filing Defaults Can Be Rectified Under Specific Compliance Conditions

HC allowed revival of GST registration that was canceled due to non-filing of returns. The petitioner's appeal had been dismissed for exceeding limitation ... Cancellation of GST registration of petitioner - non-filing of statutory returns under the provisions of the respective GST Acts - HELD THAT:- The issue has been decided in the case of [2022 (2) TMI 933 - MADRAS HIGH COURT] where it was held that The petitioners are directed to file their returns for the period prior to the cancellation of registration, if such returns have not been already filed, together with tax defaulted which has not been paid prior to cancellation along with interest for such belated payment of tax and fine and fee fixed for belated filing of returns for the defaulted period under the provisions of the Act, within a period of forty five (45) days from the date of receipt of a copy of this order, if it has not been already paid. The writ petition is disposed off. Issues:Cancellation of GST registration due to non-filing of statutory returns; Dismissal of appeal on grounds of limitation; Petitioner's appeal for revival of registration; Applicability of previous court orders on similar cases.Analysis:The judgment addresses the issue of cancellation of GST registration due to non-filing of statutory returns. The petitioner received a Show Cause Notice for this reason, citing health problems and financial crisis as causes for delayed filing. Despite the petitioner's appeal to the Appellate Commissioner, the registration was canceled. The court noted that the appeal was dismissed based on being filed beyond the limitation period, leading to the petitioner filing the present writ petition. The judgment highlights the importance of legitimate trade and commerce while ensuring tax compliance, emphasizing the need to allow suppliers to rectify defaults. The court referred to previous orders in similar cases and decided in favor of the petitioners, quashing the impugned orders and granting them a chance to revive their registration. The judgment outlines specific conditions for the petitioners to fulfill, including filing returns, paying outstanding taxes with interest, and complying with future tax liabilities in cash. It restricts the use of unutilized Input Tax Credit until approved by the authorities and directs the authorities to make necessary changes for the petitioners to comply within specified timelines.The judgment also addresses the applicability of previous court orders on similar cases. Both counsels acknowledged that the issue was covered by a detailed order of the court in a batch of writ petitions from previous years. The court's decision in those cases influenced the present judgment, leading to the quashing of impugned orders and granting relief to the petitioners. The court emphasized the need to allow legitimate trade and commerce while ensuring tax compliance, setting conditions for the petitioners to rectify their defaults and revive their registrations. The judgment reflects a consistent approach by the court in handling cases related to GST registration cancellations due to non-compliance, providing a framework for petitioners to rectify their errors and resume their business activities within specified timelines.Overall, the judgment provides a detailed analysis of the issues surrounding the cancellation of GST registration, dismissal of appeals, and the revival of registrations based on previous court orders. It underscores the importance of tax compliance while allowing legitimate trade to continue, outlining specific conditions for petitioners to rectify their defaults and comply with future tax obligations. The judgment reflects a balanced approach by the court in addressing the complexities of GST registration cancellations, ensuring fairness and adherence to statutory requirements while granting relief to affected parties.