Mohammad Nassruddin vs. The Principal Commissioner CGST And Cx

Held

The Court held that the primary object of the GST Act is the levy and collection of tax, and cancellation of registration has serious civil consequences for a business. Provisions like Sections 30 and 45 are intended to provide opportunities for defaulting firms to continue their business. Therefore, a liberal approach is required in such matters, even if the period prescribed under Section 30 of the GST Act has lapsed. The Court granted permission to the petitioner to file an application under Section 30 of the GST Act within 30 days from the date of the order. The period of limitation for filing this application will be counted from the date of the Court's order. This permission is subject to the petitioner making payment of any statutory penalty/fine, if applicable, for moving the application under Section 30.

Facts

The petitioner, Mohammad Nassruddin, proprietor of M/s Shah Star Construction, had his GST registration cancelled by an order dated 07.06.2023, issued by the Assistant Commissioner of State Taxes (Respondent No. 3). The cancellation was due to failure to furnish returns for a continuous period of six months. The petitioner sought to challenge this order by filing a writ petition before the High Court, praying for the quashing of the cancellation order and for permission to avail the option under Section 30 of the CGST Act for revocation of cancellation. The petitioner had deposited the entire tax liability and furnished the return for March 2023, along with tax deposit challans, as evidenced by a supplementary affidavit.

Key Issues

1. Whether the petitioner can be granted permission to file an application for revocation of cancellation of GST registration under Section 30 of the Central Goods and Services Tax Act, 2017, despite the expiry of the prescribed limitation period. Petitioner's contention: The petitioner argued that a Notification dated 31st March 2023 extended the time for filing revocation applications until 30th June 2023. Although the petitioner could not avail this benefit due to paucity of time, the court should grant indulgence. The petitioner has since deposited the entire tax liability and filed the return for March 2023. Respondents' contention: The respondents argued that the period of limitation for filing an application under Section 30 or an appeal to challenge the cancellation order has already lapsed, and therefore, the court should not grant any indulgence.