2026 (2) TMI 382 - HC - GST

GST registration amendment and change of management impact on tax registration; authority ordered to reconsider application and restore opportunity.

Amendment and cancellation of a GST registration arising during a corporate insolvency resolution process were challenged on grounds that the tax ... Amendment of registration certificate - cancellation of GST registration - restoration of registration - corporate insolvency resolution process - effect of change of management on tax registration - judicial review of administrative action - HELD THAT:- The case of the petitioner is that the 1st respondent, is continuing to treat the petitioner as if it is the old management that is running the petitioner company and is not willing to permit the petitioner to operate. A perusal of the impugned proceedings, issued by the 1strespondent, reinforces such a view. It appears that the 1st respondent is still acting on the premise that the old management is in place and is operating the company. This view does not stand scrutiny inasmuch as the new management has been put in place by the National Company Law Tribunal in a properly constituted corporate insolvency resolution process. Thus, it would only be appropriate that the proceedings of the 1st respondent are set aside and a fresh opportunity is given to the petitioner to seek amendment of the registration certificate issued in favour of the petitioner earlier. Accordingly, the Writ Petition is allowed and the proceedings of the 1st respondent, dated 13.11.2025 and 14.11.2025,rejecting the amendment of the registration certificate and cancelling the registration certificate are set aside and the 1st respondent shall consider the application of the petitioner, dated 03.11.2025, regarding objections given by the petitioner regarding the amendment of the registration certificate and pass orders, within a period of three weeks, from the date of receipt of this order. Issues: Whether the respondent's proceedings dated 13.11.2025 (rejecting amendment of GST registration) and 14.11.2025 (cancelling GST registration), which proceeded on the premise that the old management continued to run the company despite a new management appointed by the National Company Law Tribunal after a corporate insolvency resolution process, were valid and liable to be set aside.Analysis: The impugned decisions treated the petitioner as if the prior management remained in control despite orders in a properly constituted corporate insolvency resolution process effecting a change of management. Under the facts, the change in management flowed from orders of the National Company Law Tribunal and corresponded with restoration of the petitioner's registration; the respondent's refusal to consider the amendment application and subsequent cancellation proceeded without accepting or treating the effect of the insolvency resolution process on management and registration. In those circumstances, the respondent's actions required fresh consideration of the petitioner's amendment application in light of the new management and the supporting NCLT mandate. The respondent retains the regulatory power to act on any future violations of the GST law, but the present administrative determinations could not stand without a fresh, management-aware assessment.Conclusion: The proceedings dated 13.11.2025 and 14.11.2025 are set aside and the respondent is directed to reconsider the petitioner's amendment application dated 03.11.2025 and pass orders within three weeks; the decision is favourable to the petitioner (assessee).