GST registration cancellation dispute over refusal to accept belated or manual returns; appellate order set aside for unfair hearing.

Cancellation of GST registration was challenged on the ground that the authorities refused to permit filing of belated returns, including manual filing, thereby denying an effective opportunity to comply and be heard. Relying on a Coordinate Bench precedent, the HC held that, to secure procedural fairness, the appellate order sustaining cancellation could not stand where the taxpayer was not afforded a meaningful opportunity to regularise defaults by filing pending returns. The impugned appellate order was set aside; the petitioner was directed to file all pending returns, including for the period of cancellation, and the authority was directed to consider revocation of registration upon such compliance.

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A writ petition under Article 226 challenged the appellate order dated 04.10.2024 passed under Section 107 of the CGST Act, 2017, which dismissed the appeal and affirmed cancellation of GST registration. The petitioner contended the proper authority did not permit filing of returns "by way of manual" after expiry of the statutory period, and the parties disputed service/knowledge of notice impacting "opportunity of hearing." The respondents relied on Sections 25, 29 and 30 of the CGST Act and Rules 21(a), 21(h), 22 and 23 of the CGST Rules to submit that sufficient hearing was provided, while indicating the petitioner could pursue a fresh representation. Relying on a coordinate bench decision addressing "identical orders" where filing was denied due to lapse of time, the court adopted the same approach "in order to give the opportunity of hearing." The impugned appellate order was set aside; the petitioner was directed to submit all pending GST returns, "specially for the period when the registration was cancelled," and upon such filing the authority "shall consider the case for revocation of registration." Due to default, costs of Rs. 25,000 were imposed, payable with the pending returns. The order was noted as passed "in the peculiar facts and circumstances of the case."

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