GST registration cancellation for non-filing set aside, with restoration made conditional on return filing and dues payment.

GST registration cancelled for non-filing of returns was directed to be restored where no allegation of tax evasion or dubious conduct was made. The Court took a pragmatic view that continued cancellation would prevent the taxpayer from carrying on business, issuing invoices, and recovering tax, so interference was justified. Relief was made conditional on filing returns for the entire default period and payment of the outstanding tax, interest, fine, and penalty, if unpaid. The portal was also directed to be activated to enable compliance. The cancellation order and the appellate order were set aside subject to these conditions, and registration was to be restored on compliance.

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Issues: Whether the cancellation of GST registration for non-filing of returns should be set aside and the registration restored subject to filing of returns and payment of dues.

Analysis: The registration had been cancelled solely on the ground of non-filing of returns. The Court noted that there was no allegation of any dubious method adopted to evade tax and that continued cancellation would prevent the petitioner from carrying on business, raising invoices, and ultimately recovering tax. A pragmatic approach was considered appropriate, and the cancellation order was therefore liable to be interfered with, but only on compliance with the conditions of filing returns for the entire default period and payment of the requisite tax, interest, fine, and penalty, if unpaid. The Court also directed activation of the portal to enable compliance.

Conclusion: The cancellation order and the appellate order were set aside subject to compliance with the stated conditions, and the registration was directed to be restored upon such compliance.

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