M/S Laxmi Enterprises vs. The Additional Commissioner Of Central GST And Central Excise (Appeals)
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Cause title — parties, addresses and appearances
ORAL ORDER
(PER: THE HON'BLE MR. JUSTICE M.NAGAPRASANNA)
The petitioner is before this Court seeking the following prayer: “a) Issue a writ of certiorari or any other appropriate writ, order or direction calling for the records and proceedings relating to the cancellation of GST registration vide order No.ZA290324050755E dated 13.03.2024 vide Annexure-C and to quash the same. b) Issue a writ of mandamus or any other appropriate writ, order or direction directing the respondents to restore the GST registration of the petitioner bearing GSTIN.29FCHPK6917E1ZB forthwith. c) Pass such other and further orders as may be deemed fit and proper in the interest of justice and equity.”
The learned counsel appearing for the petitioner submits that the issue involved is akin to the one decided by a Co-ordinate Bench of this Court, which pertained to the cancellation of GST registration.
The learned counsel for the respondent does not dispute the position of law as is laid down by the Co-ordinate Bench and that Co-ordinate Bench in W.P. No.107545 of 2023 disposed on 05.02.2024 has held as follows. HC-KAR NC: 2025:KHC-D:18155 “The petitioner proprietor concern is involved in the business of providing hostel accommodation services for training of recruits of Railway Recruitment Board, hotelier and restaurateur and was issued with registration certificate in Form No.GST REG-06 under section 10 of Karnataka Goods and Service Tax Act, 2017 read with Rule 10-(1) of Karnataka Goods and Service Tax Rules, 2017. 2. The registration certificate issued in favour of the petitioner was cancelled for not filing returns for more than six months as stated under section 29 of the GST Act. Taking exception to the same, an appeal was filed before the 1 st respondent under section 107 of the GST Act. The said appeal came to be dismissed, since the same was filed after the period of limitation prescribed, and there is no provision under section 107 of the Act to condone the delay in filing the appeal. Hence, this petition.
Learned counsel for petitioner submits that the impugned order cancelling the registration certificate was notified to the accountant of the petitioner, and the order having not been communicated, there was a delay in filing the appeal before the 1st respondent. He further submits that the petitioner has paid the entire arrears of tax, interest, penalty and late fees for the belated filing of the returns, and therefore, no prejudice will be caused to the State, if the order of cancellation of the registration of the certificate issued in favour of the petitioner is revoked.
Learned Addl. Government Advocate for the State would submit that the petitioner having not filed the returns within six months, as contemplated under section 29 of the GST Act, respondent No.2 has rightly cancelled the registration certificate. He further submits that the petitioner having not filed the appeal within the limitation prescribed, the 1st respondent has dismissed the appeal, as barred by limitation and the same does not warrant any interference.
Considered the submissions made by the learned counsel for the petitioner and the learned Addl. Government Advocate for the State. HC-KAR NC: 2025:KHC-D:18155
Section 29 of the GST Act, 2017 deals with cancellation or suspension of registration, and clause (c) of sub-section (2) of section 29 states that the competent authority may cancel the registration of a person if he has not furnished returns for a continuous period of six months. Therefore, reading of the said provision indicates that the competent authority before cancelling the registration certificate should assign reasons for cancellation of the registration.
In the instant case the 2nd respondent has not assigned reasons except stating that the petitioner has not filed returns for six months and the order cancelling the registration certificate issued in favour of the petitioner is one without application of mind and adversely affects the right of the petitioner to carryon a business as guaranteed under Article 19(1)(g) of the Constitution of India. The petitioner after cancellation of the registration certificate has tendered the entire arrears of tax including interest, penalty and late fees for filing the returns belatedly. Such being the case, the cancellation of the registration certificate granted in favour of the petitioner would be arbitrary and discriminatory. Accordingly, I pass the following: ORDER i) The writ petition is allowed. ii) The impugned order dated 05.10.2023 passed by the 1st respondent in Appeal No.BGM-JJ-ADC-78-2023-24-GST, produced at Annexure-A and the order dated 12.01.2023 passed by the respondent No.2, cancelling registration of the petitioner, produced at Annexure-F are hereby quashed. iii) Respondent No.2 to restore the certificate of registration dated 08.08.2018 granted in favour of the petitioner and permit the petitioner to file returns under the provisions of the GST Act.” HC-KAR NC: 2025:KHC-D:18155
In the light of the issue standing covered in the afore-quoted supra, the following: ORDER i) The writ petition is allowed. ii) The impugned proceedings relating to cancellation of GST registration dated 13.03.2024 vide Annexure – C stands quashed. iii) Respondent No.2 to restore the certificate of registration dated 14.09.2023 granted in favour of the petitioner and permit the petitioner to file returns under the provisions of the GST Act. (M.NAGAPRASANNA) JUDGE
RSH / CT: ASC LIST NO.: 1 SL NO.: 178
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.