2025 (4) TMI 1707 - HC - GST

GST registration cancelled for six months' non-filing; superintendent to disclose outstanding dues and penalties for restoration

Shivan Dakpe Versus The Union of India and 2 Ors represented by the Secretary, New Delhi, The Commissioner of CGST and Central Excise, Arunachal Pradesh, The Superintendent of Central Goods and Service Tax, Arunachal Pradesh

HC upheld cancellation of GST registration for a petitioner who failed to file returns for six months but directed the Superintendent, GST, to inform the ... Territorial jurisdiction - cancellation of GST registration - petitioner was unable to file his GST Returns for six months - HELD THAT:- It is seen that a similar order has already been passed by the Coordinate Bench of this Cout in the matter of Krishanu Borthakur v. Union of India [2025 (1) TMI 721 - GAUHATI HIGH COURT] where it was held that 'It is directed that the Respondent No. 3, namely Superintendent of Central Goods & Services Tax, Guwahati will intimate the petitioner the total outstanding statutory dues, if any, standing in the name of the petitioner till the date of cancellation of his GST registration.' The Superintendent, GST, Itanagar Range (respondent no.3), will intimate the petitioner his total statutory outstanding dues, if any, in the name of the petitioner having trade name of M/s. RSSS Enterprises till the date of cancellation of the GST registration and any penalty and fine as may be found due as on the date of restoration of the GST registration so as to enable the petitioner to make payment of the entire statutory dues under CGST Act by the petitioner. Petition disposed off. ISSUES PRESENTED AND CONSIDERED 1. Whether an order of cancellation of GST registration passed by the Superintendent, GST (Itanagar Range) on 27.05.2023 should be set aside where the registrant failed to file returns for six months due to prolonged ill-health and did not reply to the show cause notice leading to suspension and cancellation. 2. Whether the petitioner, having missed the statutory period to prefer an appeal or to apply for revocation online, can seek relief under Article 226 by invoking the Court's discretion in light of similar orders passed by coordinate Benches. 3. Whether restoration of cancelled GST registration can be made conditional upon payment of outstanding statutory dues, penalties and fines and, if so, the manner and timeline for such restoration. ISSUE-WISE DETAILED ANALYSIS Issue 1 - Validity of cancellation of GST registration where returns were not filed for six months and no reply was furnished to show cause notice Legal framework: The CGST regime permits suspension and cancellation of registration for non-compliance, including non-filing of returns; authorities issue show cause notices and may suspend/cancel registration where no satisfactory reply is received. Precedent Treatment: The Court treated prior coordinate-bench orders as applicable and analogous rather than distinguishing or overruling them. Interpretation and reasoning: The Court recognised that the cancellation order was passed by the Superintendent, GST, Itanagar Range and accepted the factual explanation that jurisdictional alignment placed the establishment within that Range. The Court noted the petitioner's prolonged health issues as the cause for non-filing but did not find those facts dispositive against the statutory power to cancel; rather, it considered equitable relief appropriate in the circumstances and in alignment with earlier decisions. Ratio vs. Obiter: Ratio - The Court's decision to set aside the cancellation order was based on equitable considerations tied to the petitioner's circumstances (ill-health causing non-compliance) and the availability of a remedy by revocation subject to payment of dues. Obiter - Observations about the administrative generation location of the order and the manner of respondent numbering are procedural clarifications without bearing on the substantive validity of cancellation. Conclusions: The cancellation was set aside on conditional grounds; the Court did not declare the cancellation void on absolute legal grounds but provided conditional restoration premised on payment of statutory dues and compliance, thereby affording equitable relief despite statutory non-compliance. Issue 2 - Availability of writ relief under Article 226 where statutory appeal/revocation periods have lapsed Legal framework: Article 226 permits High Courts to issue writs in appropriate cases where statutory remedies are inadequate or where discretion must be exercised; tax statutes provide time-limited routes for appeal and revocation with defined condonation/jurisdictional limits. Precedent Treatment: The Court relied on and followed recent coordinate-bench orders that granted conditional relief in analogous circumstances (citing earlier orders as guiding precedents for equitable restoration subject to dues). Interpretation and reasoning: The Court accepted that the statutory period for appeal/revocation had lapsed and that the appellate authority's power to condone delay was limited; in those circumstances, the Court held that the petitioner's remedy by direct writ was permissible. The Court found it appropriate to exercise its discretionary jurisdiction because statutory remedies were effectively foreclosed and the case involved substantive equities (health-related non-compliance) and feasible compliance by payment of dues. Ratio vs. Obiter: Ratio - Where statutory remedy is time-barred and condonation is unavailable or inadequate, the Court may entertain writ jurisdiction and grant conditional relief restoring registration upon compliance with statutory dues. Obiter - Comments on the scope of condonation powers of the appellate authority beyond the statutory limits are incidental. Conclusions: Writ relief under Article 226 was appropriate and was exercised to set aside the cancellation conditionally because the petitioner lacked an effective alternative remedy due to time-bar limitations. Issue 3 - Appropriateness and terms of conditional restoration (payment of dues, timeline, and administrative steps) Legal framework: Restoration of registration by revocation of cancellation is governed by CGST provisions subject to payment of outstanding tax, interest, penalty and satisfaction of procedural requirements; courts may frame conditions for relief to balance statutory enforcement with equitable considerations. Precedent Treatment: The Court followed coordinate-bench decisions which similarly conditioned restoration on payment of dues and adherence to administrative processes; those orders were applied as directly persuasive in framing relief. Interpretation and reasoning: The Court fashioned specific, enforceable conditions: (i) respondent to intimate total statutory outstanding dues, including penalties and fines, as on date of restoration; (ii) petitioner to pay dues within 21 days of intimation; (iii) upon proof of payment within the allowed period, respondent to revoke the cancellation order and restore registration. The Court endorsed this structure as aligning statutory expectations with practical administration and as ensuring respondents retain oversight to compute dues while giving the petitioner a clear, finite window to comply. Ratio vs. Obiter: Ratio - Conditional restoration predicated on receipt of full statutory dues within a fixed period and administrative confirmation is a valid and enforceable remedy under the Court's writ jurisdiction. Obiter - The Court's reference to territorial jurisdictional alignment between Superintendent offices is procedural clarification, not essential to the legal principle on conditional restoration. Conclusions: Restoration was ordered conditionally with a defined procedure and timeline: respondents to communicate dues; petitioner to pay within 21 days; upon proof of payment, respondent to revoke the cancellation and restore registration. Costs were left to parties, indicating no adverse cost order attached to the relief. Cross-references and Implementation Notes The Court explicitly relied on and followed coordinate-bench decisions as guiding precedent for exercising writ jurisdiction and for the form of conditional relief; those earlier orders informed both the legal basis for relief and the specific procedural conditions imposed. The directives concerning computation of dues, timeline for payment and administrative revocation are integral to the operative relief and constitute the binding part of the decision (ratio), while procedural observations regarding which Superintendent was named in the order are ancillary.