M/S.Bhavishya Projects vs. Assistant Commissioner Of Central Tax
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A proprietorship's GST registration was cancelled in July 2019 and subsequently revoked in April 2023. The petitioner then filed GSTR-3B returns in May 2023 for the financial period 2019-20, which the respondent refused to accept, leading to an order denying Input Tax Credit (ITC) reversal.
Held
The High Court quashed the respondent's order, directing the authority to re-examine the petitioner's GSTR-3B returns filed on May 29, 2023, specifically excluding the question of limitation. This was subject to the petitioner paying a cost of Rs. 50,000.
Key Issues
Whether Input Tax Credit (ITC) could be denied for returns filed after the original due date but within thirty days from the date of revocation of GST registration, in light of the relevant statutory provisions.
Sections Cited
Section 16(4), Section 16(6)
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Cause title — parties, addresses and appearances
ORAL ORDER
The petitioner's grievance is with the respondent's Order dated 27.08.2024 refusing reversal of the Input Tax Credit [ITC] accepting the returns filed by the petitioner in GSTR-3B. The respondent has issued Show Cause Notice prior to the impugned order and the respondent has also extended opportunity of personal hearing. The petitioner's representative has participated in the personal hearing on 28.07.2019 only to state that in view of the recommendations of the GST Council to extend time limit under Section 16(4) of the Central Goods and Services Tax Act, 2017/Karnataka Goods and Services Tax Act, 2017 [for short, 'the CGST/KGST Act'], the proceedings could be dropped.
The question for interference and the terms for interference, if there could be, are examined in the light of the following undisputed facts. HC-KAR
CNR: KAHC010515462026 NC: 2026:KHC:39382 [a] The impugned demand is for the financial period 2019-20. The petitioner's GST registration is cancelled on 28.07.2019 but such cancellation is revoked on 28.04.2023. [b] In the interregnum, the time limit for filing of Returns had expired.
[c] The petitioner, with the revocation of the GST cancellation, has filed the Returns in Form GSTR-3B on 29.05.2023. The Returns are filed within thirty [30] days if the intervening Sunday [28.05.2023] is excluded.
It is not in dispute that with the amendment to Section 16(6) of the CGST/KGST Act, it would be open to the concerned Registered Taxable Person to file Returns within thirty [30] days from the date of order of revocation of cancellation of GST HC-KAR
CNR: KAHC010515462026 NC: 2026:KHC:39382 registration. It is obvious that the petitioner's representative, who could have brought to the respondent's notice that the petitioner's GST registration is cancelled and an application for revocation of such cancellation is filed/could be filed, has not stated the same.
Crucially, the petitioner is granted the benefit of revocation of the cancellation of the GST registration, and the Returns are filed within thirty [30] days as contemplated under Section 16(6)(ii) of the of the CGST/KGST Act. These circumstances persuade this Court to interfere with the respondent's Order dated 27.08.2024 to call upon the respondent to examine the returns filed, excluding the question of limitation. The next aspect that has to be considered is the delay in the petitioner invoking this Court's juri iction under Article 226 of Constitution of India after a lapse of almost two years. HC-KAR
CNR: KAHC010515462026 NC: 2026:KHC:39382
Mr. K. M. Shivayogiswamy, the learned counsel for the petitioner, can only plead bonafides referring to the petitioner's authorized representative having to handle a medical contingency which required some hospitalization in the year 2019-20. In the circumstances discussed on the merits of the petitioner's right to file the Returns subject to revocation of the cancellation of the GST registration, this Court opines that the petitioner must be called upon to pay a reasonable cost. In the light of the afore, the following. ORDER
[A] The petition is allowed.
[B] The respondent's impugned order dated 27.08.2024 [Annexure - B] is quashed restoring the proceedings calling upon the respondent to examine the Returns filed by the petitioner on 29.05.2023 in Form HC-KAR
CNR: KAHC010515462026 NC: 2026:KHC:39382 GSTR-3B subject to the petitioner producing a copy of the receipt for payment of cost of Rs.50,000/- to the High Court Legal Services Committee. (B M SHYAM PRASAD) JUDGE
RB
Reproduced from the public record of the Karnataka High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.