GST Registration Restored: Conditional Appeal Granted with Compliance Mandate Under Specific Tax Regulations

HC allowed appeal challenging GST registration cancellation. Despite initial time-barred appeal rejection, Court granted conditional restoration of registration. Petitioner must file pending returns, pay tax dues with interest within 45 days, and comply with specific GST compliance requirements. Court provided remedial directions facilitating registration reinstatement while ensuring regulatory adherence.

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Issues involved: Appeal against cancellation of GST registration, rejection of appeal as time-barred, restoration of registration.

The petitioner challenged an appellate order rejecting the appeal against the cancellation of their GST registration. The petitioner received a show cause notice asking why the registration should not be cancelled, to which they responded stating no business activity for eleven months with nil returns filed. Subsequently, the cancellation order was issued, and the appeal against it was rejected as time-barred.

The petitioner contended that due to the rejection of the appeal, they had no remedy except to approach the High Court. The counsel relied on a previous order of the Court in related matters. On the other hand, the senior standing counsel for the respondents highlighted that the appeal was filed after the condonable delay period and raised concerns about the unclear filing of returns up to the cancellation date.

The Court noted that the appellate authority rightfully rejected the appeal based on the provisions of Section 107 of the Central Goods and Services Tax Act, 2017. However, recognizing the need to provide a remedy, the Court referred to a previous case directing restoration of registration under certain conditions. Considering the circumstances, the petitioner was granted similar relief.

The Court disposed of the writ petition with specific directions for the petitioner, including filing returns for the period before cancellation, payment of tax dues with interest and fees within 45 days, and restrictions on utilizing unclaimed Input Tax Credit. The approval of Input Tax Credit for future use was emphasized, along with the requirement to pay GST and file correct value of supplies for subsequent periods.

The restoration of GST registration was made conditional upon fulfilling the prescribed conditions. The Court ordered suitable changes in the GST Web portal to facilitate compliance by the petitioner within a specified timeframe. The case was closed with no costs awarded.

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