Sri Naimul Islam Barbhuiya vs. The Union Of INDIA And 3 Ors
Original PDF →Facts
The petitioner, Sri Naimul Islam Barbhuiya, proprietor of Nishat Filling Station, had his GST registration cancelled by the Superintendent, Silchar I Range, on 11.09.2023, due to non-filing of GST returns for six consecutive months. A show cause notice dated 08.08.2023 was issued, requiring a reply within 30 days and personal hearing on 05.09.2023. The petitioner claims he could not reply due to miscommunication with his tax consultant, and by the time he realized, the time for reply had passed, and the cancellation order was uploaded. He later updated all pending returns up to July-September 2023 and paid dues, interest, and late fees. However, he could not file an application for revocation of cancellation as the 270-day timeline had expired. An appeal against the cancellation order was dismissed on 12.02.2026. Aggrieved, the petitioner filed a writ petition.
Held
The Court held that the cancellation of GST registration carries serious civil consequences. Considering the petitioner's submission that he has since furnished all pending returns and made full payment of tax dues, along with applicable interest and late fees, and in light of the proviso to sub-rule (4) of Rule 22 of the CGST Rules, 2017, the Court directed the petitioner to approach the concerned authority within two months from the date of the order seeking restoration of his GST registration. If the petitioner complies with all requirements as per the proviso to Rule 22(4), the concerned authority shall consider the application for restoration in accordance with law and take necessary steps expeditiously. The Court clarified that the period stipulated under Section 73(10) of the CGST/SGST Act shall be computed from the date of this order, except for the financial year 2024-25. The petitioner is liable to pay arrears of tax, penalty, interest, and late fees. This order was passed on the peculiar facts and is not to be taken as a precedent.
Key Issues
1. Whether the petitioner can seek restoration of his GST registration despite the expiry of the statutory timeline for revocation applications, given that he has now complied with the pending return filings and payment of dues, interest, and late fees? The petitioner argued that due to miscommunication with his tax consultant, he failed to respond to the show cause notice and subsequently missed the deadlines for reply and revocation application. He emphasized his willingness to comply with all formalities and has since updated all pending returns and paid all dues, interest, and late fees. He relies on the proviso to sub-rule (4) of Rule 22 of the CGST Rules, 2017, which allows for dropping proceedings if pending returns are furnished and dues are paid. The revenue, represented by the Senior Standing Counsel, opposed the writ petition, primarily raising the issue of delay in approaching the Court and the expiry of the statutory timelines.
Sections Cited
Section 29, Rule 22, Section 73
AI-generated summary — verify with the full judgment below
Cause title — parties, addresses and appearances
JUDGMENT & ORDER (Oral)
Heard Shri R.S. Mishra, learned counsel for the petitioner and Shri S. C. Keyal, learned Senior Standing Counsel, CGST for the respondent nos. 2 to 4.Ms. M. Das, learned counsel is present for the Union of India on behalf of Shri S.K. Medhi, learned CGC.
It is the case of the petitioner that the petitioner has been carrying out his business under the name & style, “Nishat Filling Station”. He is the sole proprietor and is an assessee registered under the Central Goods and Services Tax (CGST) Act, 2017/Assam Goods and Services Tax (AGST) Act, 2017bearing registration No. 18AVMPB8905C1ZO. Because of non-filing of GST returns for a continuous period of six months, the petitioner was served with a show cause notice bearing reference No. ZA1808230079475 dated 08.08.2023 asking the Page No.# 3/7 petitioner to furnish reply to the aforesaid notice within a period of 30 (thirty) days from the date of service of notice as well as directed to appear for personal hearing on 05.09.2023 at 11.00 and it was mentioned in the aforesaid show cause notice that if he fails to furnish a reply within the stipulated date or fails to appear for personal hearing on the appointed date and time, the case will be decided ex-parte on the basis of the available records and on merits. Thereafter, the impugned order dated 11.09.2023 was passed by the Superintendent, Silchar I, Range, Silchar-4, whereby the petitioner’s GST registration has been cancelled without assigning any reason.
The petitioner contended that due to miscommunication with the Tax Consultant, he could not submit any reply to the said show cause notice. It is further contended that when he came across the said notice, the time for filing reply was already over and order had also been uploaded in the portal. Though the petitioner preferred appeal, the same was dismissed vide order dated 12.02.2026. 4. It is further contended that the petitioner has updated all pending returns up to July-September, 2023 as allowed by the GST portal and while updating returns, the petitioner has also discharged all GST dues along with late fees and interest.
Thereafter, the petitioner tried to file the necessary application seeking revocation of GST cancellation, however, the same could not be filed as the time limit prescribed for filing of revocation application was elapsed and a message was displayed in the screen “timeline of 270 days from the date of cancellation order provided to taxpayer to file application for revocation of cancellation is expired.”
Page No.# 4/7
Being aggrieved, the petitioner has approached this Court by filing the present writ petition.
Shri Mishra, learned counsel for the petitioner has submitted that the petitioner is ready and willing to comply with all the formalities required as per proviso to sub-rule (4) of Rule 22 of the CGST Rules, 2017. On the other hand, Shri Keyal, the learned Senior Standing Counsel has opposed the writ petition and further has raised the issue of delay in approaching the Court.
As per Section 29(2)(c) of the Act, an officer, duly empowered, may cancel the GST registration of a person from such date, including any retrospective date, as he deems fit, where any registered person, has not furnished returns for a continuous period of 6 (six) months. Rule 22 of the CGST Rules, 2017 has laid down the procedure for cancellation of the registration.
Rule 22 of the CGST Rules, 2017 being the bone of contention, is extracted herein below: Rule 22 : Cancellation of Registration (1) Where the proper officer has reasons to believe that the registration of a person is liable to be cancelled under Section 29, he shall issue a notice to such person in FORM GST REG-17, requiring him to show cause, within a period of seven working days from the date of the service of such notice, as to why his registration shall not be cancelled. (2) The reply to the show cause notice issued under sub-rule [1] shall be furnished in FORM REG-18 within the period specified in the said sub-rule. (3) Where a person who has submitted an application for cancellation of his registration is no longer liable to be registered or his registration is liable to be cancelled, the proper officer shall issue an order in FORM GST
Page No.# 5/7 REG-19, within a period of thirty days from the date of application submitted under Rule 20 or, as the case may be, the date of the reply to the show cause issued under sub-rule (1), (or under sub-rule (2A) of Rule 21A) cancel the registration, with effect from a date to be determined by him and notify the taxable person, directing him to pay arrears of any tax, interest or penalty including the amount liable to be paid under sub-section (5) of Section 29. 4) Where the reply furnished under sub-rule (2) (or in response to thenotice issued under sub-rule (2A) of Rule 21A) is found to be satisfactory, the proper officer shall drop the proceedings and pass an order in FORM GST REG-20 : Provided that where the person instead of replying to the notice served under sub rule (1) for contravention of the provisions contained in Clause (b) or Clause (c) of sub-section (2) of section 29, furnishes all the pending returns and makes full payment of the tax dues along with applicable interest and late fee, the proper officer shall drop the proceedings and pass an order in FORM GST REG-20. (5) The provisions of sub-rule (3) shall, mutatis mutandis, apply to the legal heirs of a deceased proprietor, as if the application had been submitted by the proprietor himself.
It is discernible from a reading of the proviso to sub-rule (4) of Rule 22 of the Rules of 2017 that if a person, who has been served with a show cause notice under Section 29(2)(c) of the Act, is ready and willing to furnish all the pending returns and to make full payment of the tax itself along with applicable interest and late fee, the officer, duly empowered, can drop the proceedings and Page No.# 6/7 pass an order in the prescribed Form i.e. Form GST REG-20. 11. The learned counsel for the parties have also referred to an Order dated 11.10.2023 passed in a writ petition being WP(C) No.6366/2023 (Sanjoy Nath vs. The Union of India and others) wherein the petitioner therein was similarly situated like the present petitioners.
Having regard to the fact that the GST registration of the petitioner has been cancelled under Section 29(2)(c) of the Act, for the reason that the petitioners did not submit returns for a period of 6 (six) months and more and the provisions contained in the proviso to sub-rule (4) of Rule 22 of the CGST Rules, 2017 and cancellation of registration entails serious civil consequences, this Court is of the considered view that in the event the petitioner approach the officer, duly empowered, by furnishing all the pending returns and make full payment of the tax dues, along with applicable interest and late fee, the officer duly empowered, may consider to drop the proceedings and pass an appropriate order in the prescribed Form.
In such view of the matter, this writ petition is disposed of by providing that the petitioner shall approach the concerned authority within a period of 2 (two) months from today seeking restoration of her GST registration. If the petitioner submit such an application and complies with all the requirements as provided in the proviso to Rule 22 (4) of the Rules, the concerned authority shall consider the application of the petitioner for restoration of GST registration in accordance with law and shall take necessary steps for restoration of GST registration of the petitioner as expeditiously as possible.
It is needless to say that the period as stipulated under Section 73 (10) of the Central GST Act/State GST Act shall be computed from the date of the Page No.# 7/7 instant order, except for the financial year 2024-25, which shall be as per Section 44 of the Central GST Act/State GST Act. The petitioner herein would also be liable to make payment of arrears i.e. tax, penalty, interest and late fees. It is clarified that this order has been passed on the peculiar facts of this case and shall not be taken as a precedent.
The writ petition accordingly stands disposed of.
JUDGE Comparing Assistant
Reproduced from the public record of the Gauhati High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.