Cancellation of GST registration for non-filing of returns may be revoked if returns and dues are filed within a set timeframe.

Cancellation of GST registration was challenged where sole ground was failure to furnish returns for a continuous six month period; no finding of fraud, suppression or tax evasion was made. The legal approach prioritises restoration subject to completion of statutory compliance: petitioner must file returns for the default period and pay taxes, interest, late fees, penalties, costs and charges within a limited timeframe, and the assessing officer must enable portal access to facilitate compliance. Failure to meet these conditions results in reinstatement of the cancellation order and dismissal of the petition.

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Issues: Whether the order canceling the petitioner's GST registration for failure to furnish returns for a continuous period of six months should be set aside and the petitioner's registration restored subject to compliance with specified conditions.

Analysis: The cancellation challenged under Section 107 of the Central Goods and Services Tax Act, 2017 and the corresponding provision of the West Bengal Goods and Services Tax Act, 2017 was effected solely on the ground of failure to furnish returns for a continuous period of six months. There is no finding or allegation of fraud, suppression, or evasion of tax in the show-cause notice or cancellation order. The petitioner has expressed willingness to continue business, file returns for the entire period of default and pay all taxes, interest, late fees, penalties, costs and charges. Balancing the interest of the petitioner and potential revenue loss to the State, the order of cancellation was considered capable of being set aside on terms that require the petitioner to complete statutory compliance within a limited timeframe, with administrative facilitation by the assessing officer to enable compliance.

Conclusion: In favour of the assessee: The order of cancellation dated March 14, 2023 is set aside and the petitioner's registration shall be restored upon the petitioner filing returns for the entire period of default and paying all taxes, interest, late fees, penalties, costs and charges within four weeks; the jurisdictional assessing officer shall activate the petitioner's portal and login credentials within one week to enable compliance; failure to comply within the specified time will result in automatic dismissal of the writ petition and revival of the cancellation order.

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