Taxpayer Gets Second Chance: GST Registration Restored with Compliance Conditions, Pending Returns Must Be Filed Within Seven Days

HC allowed petition challenging GST registration cancellation, directing restoration of registration conditional on filing pending returns and settling dues within one week. Court balanced statutory compliance with preventing undue business disruption, providing a final opportunity for rectification while reserving authorities' right to take further action for non-compliance.

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Issues:
1. Impugning an order cancelling GST registration.
2. Rejection of application for condonation of delay in filing revocation application.

Analysis:

Issue 1: The petitioner challenged the cancellation of their GST registration due to non-filing of returns for six consecutive months. The Proper Officer issued a show cause notice (SCN) and suspended the registration. The petitioner failed to respond to the SCN, leading to the cancellation of registration. The petitioner later applied for revocation, citing a dispute with their accountant as the reason for the delay. However, the application was rejected for being filed beyond the stipulated ninety days. The petitioner admitted the non-compliance but promised to rectify the situation by filing returns and paying dues.

Issue 2: The Court referred to previous judgments highlighting the importance of not hindering taxpayers' business due to registration cancellations. Drawing from these precedents, the Court directed the restoration of the petitioner's GST registration with the condition that all pending returns and dues be settled within a week of restoration. Failure to comply would result in another cancellation. The Court clarified that this decision did not prevent authorities from taking further action for non-compliance or debt recovery.

In conclusion, the Court allowed the petition, ordering the restoration of the petitioner's GST registration under specific conditions. Failure to meet these conditions would lead to another cancellation. The judgment emphasized the importance of compliance with statutory provisions while ensuring that business activities are not unduly disrupted.

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