GST Registration Cancellation Overturned: Petitioner Granted Fresh Hearing to Address Procedural Defects and Tax Compliance

HC allowed the writ petition challenging GST registration cancellation. The court set aside the orders by tax authorities and remanded the matter for reconsideration, directing respondents to provide a fresh hearing opportunity to the petitioner. The decision was made noting procedural lapses and ensuring the petitioner can submit required returns during the reconsideration process.

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Issues:
1. Petition seeking quashing of the order cancelling GST registration.
2. Appeal dismissed due to being beyond the limitation period.
3. Tribunal not constituted in the State of Telangana.

Analysis:
1. The petitioner filed a petition under Article 226 seeking to quash the order dated 29.12.2020 by respondent No.3 canceling the Goods and Services Tax (GST) registration, along with the order-in-appeal dated 25.10.2022 dismissing the appeal. The petitioner was registered as a taxable person under the Central Goods and Services Tax Act, 2017. A show-cause notice was issued for not filing monthly returns, and despite the petitioner's reply, the registration was canceled under Section 29(2)(c) of the CGST Act. The appeal was dismissed by respondent No.2 citing a limitation period issue.

2. The High Court noted that the issue of cancellation of GST registration had been addressed in previous writ petitions, including a specific case cited for reference. Following the principle of parity, the Court decided to grant the petitioner another opportunity. The Court set aside the orders of respondent No.3 and respondent No.2, remanding the matter back to respondent No.3 for reconsideration and passing an appropriate order after providing a hearing opportunity to the petitioner. The petitioner was also allowed to submit all the required returns during the hearing process.

3. Despite the provision for a further appeal before a Tribunal under Section 109 of the CGST Act, the absence of such a Tribunal in Telangana led the petitioner to approach the High Court through the writ petition. The High Court's decision to remand the matter back to the tax authorities for fresh consideration aimed to ensure justice and proper opportunity for the petitioner. The writ petition was disposed of without costs, and any related pending miscellaneous petitions were closed as a result of the judgment.

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