GST registration cancellation for non-filing may be restored where dues are paid and no fraud is alleged.

Cancellation of GST registration for continuous non-filing of returns may be treated as curable where there is no allegation of fraud or unlawful conduct and the default is linked to financial hardship or the Covid-19 period. The article notes that in such circumstances, restoration can be permitted if the taxpayer is willing to clear outstanding GST dues together with late fee, penalty and interest, and if the authorities first ascertain the payable amount. The practical effect is that registration may be restored on timely payment of the intimated dues.

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Issues: Whether the petitioner's cancelled GST registration should be restored despite non-filing of returns for a continuous period of six months.

Analysis: The cancellation arose from failure to file GST returns, but there was no allegation of unlawful activity or fraud. The default was attributed to financial and the period of non-compliance was proximate to the Covid-19 pandemic. The petitioner expressed readiness to pay the outstanding GST dues, late fees, penalty, and applicable interest. In similar circumstances, restoration had been granted by the Court subject to payment of all dues.

Conclusion: The cancelled GST registration was directed to be restored after the authorities ascertain the dues and the petitioner pays the amount intimated within the stipulated time.

Ratio Decidendi: Where cancellation of GST registration is solely for non-filing of returns, without fraud or unlawful conduct, and the taxpayer undertakes to clear all outstanding dues with interest and consequential charges, restoration may be ordered on payment of the assessed amount.

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