M.S Panchshil Infrastructure Ahmednagar vs. The State Of Maharashtra And Others

Facts

The Petitioner, M/s. Panchshil Infrastructure, filed a writ petition challenging an order dated 26.10.2021 passed by the State Tax Officer (Respondent No. 3) and an order dated 11.12.2024 passed by the Deputy Commissioner of State Tax (Appeals) (Respondent No. 4). The Petitioner sought to quash these orders and alternatively sought a writ of mandamus directing the State Tax Officer to reinstate the Petitioner's earlier GST registration. The Petitioner's GST registration had been cancelled. The Respondent/State argued that there was a two-year delay in filing the appeal, and the Deputy Commissioner had no authority to condone such delay, thus finding no fault with the impugned order.

Held

The Court allowed the writ petition, quashing and setting aside the order dated 26.10.2021 passed by the State Tax Officer and the order dated 11.12.2024 passed by the Deputy Commissioner of State Tax (Appeals). The Court held that the provisions of the GST enactment should not be interpreted to deny the right to carry on trade and commerce, which is a constitutional guarantee. While acknowledging that the Deputy Commissioner may not have the power to condone delays beyond 30 days under Section 107 of the MGST Act, the Court emphasized that constitutional courts, under Article 226, cannot be restricted by the provisions of any Act to bar or curtail remedies. The Court followed its own decision in Rohit Enterprises, which held that the right to carry on trade or profession cannot be curtailed contrary to constitutional guarantees. The Court reasoned that if the Petitioner is not allowed to revive registration, the State would suffer revenue loss, defeating the GST regime's goal. The Petitioner's GST registration was held to be valid from 01.03.2020 onwards, subject to filing up-to-date returns and depositing all pending dues, interest, penalty, and late fees as per Rule 23(1) of the MGST Rules, 2017. The issue of the Deputy Commissioner's power to condone delay beyond 30 days was implicitly addressed by the Court exercising its writ jurisdiction to grant relief.

Key Issues

1. Whether the Deputy Commissioner of State Tax has the authority to condone a delay of two years in filing an appeal against the cancellation of GST registration, as per Section 107 of the MGST Act, 2017? 2. Whether the Petitioner's right to carry on trade and commerce under Article 19(1)(g) of the Constitution of India can be curtailed due to procedural shortcomings in the GST enactment, specifically regarding the limitation period for appeals? Petitioner's Arguments: The Petitioner relied on several High Court judgments, including Rohit Enterprises V/s. The Commissioner State GST and M/s. Sambhaji Multi Services V/s. The Commissioner State GST, to argue that the right to carry on trade and commerce is a constitutional guarantee that cannot be denied. They contended that the objective of limitation provisions is to terminate litigation, not to divest a person of their rights, and that the cancellation of registration should not be a barrier to revival, especially when no accrued right of the State is adversely affected. Revenue/State's Arguments: The Revenue/State argued that there was a significant delay of two years in filing the appeal, and the Deputy Commissioner lacked the authority to condone this delay. Therefore, they contended that the impugned order was justified.