Sikhit Nibanua Juuak Thika Aru Jogan Samobai Samati LTD vs. The Union Of INDIA And 3 Ors

Held

The Court held that cancellation of GST registration entails serious civil consequences. Referring to Section 29(2)(c) of the CGST Act, 2017, and Rule 22(4) of the CGST Rules, 2017, particularly its proviso, the Court found that if a person served with a show cause notice for non-filing of returns is willing to furnish all pending returns and make full payment of tax dues, applicable interest, and late fees, the empowered officer can drop the proceedings and pass an order in Form GST REG-20. The Court directed the petitioner to approach the concerned authority within two months from the date of the order, seeking restoration of their GST registration. Upon compliance with the requirements of the proviso to Rule 22(4), the authority should consider the application for restoration expeditiously. The Court also clarified that the period stipulated under Section 73(10) of the CGST/SGST Act would be computed from the date of the instant order, except for the financial year 2024-25, which would be as per Section 44. The petitioner would be liable to pay arrears of tax, penalty, interest, and late fees.

Facts

The petitioner, Sikhit Nibanua Juuak Thika Aru Jogan Samobai Samati Limited, a co-operative society, had its GST registration cancelled by the Superintendent, Central Goods and Services Tax, Naharkatia-1, Duliajan Range, via an order dated 03.12.2020. This cancellation was due to non-filing of GST returns for six consecutive months. The petitioner received a show cause notice dated 27.08.2020, but claims it could not reply due to the COVID-19 pandemic and office closure. The time for reply had passed, and the cancellation order was uploaded. An appeal filed by the petitioner was dismissed on 04.07.2025. Aggrieved, the petitioner filed a writ petition before the High Court.

Key Issues

1. Whether the cancellation of GST registration under Section 29(2)(c) of the CGST Act, 2017, for non-filing of returns for six months, can be dropped if the petitioner complies with the proviso to Rule 22(4) of the CGST Rules, 2017, by furnishing pending returns and making full payment of tax dues, interest, and late fees? Petitioner's contention: The petitioner argued that due to the COVID-19 pandemic, its office was closed, preventing timely filing of returns and replies to the show cause notice. They are now ready and willing to comply with the requirements of the proviso to sub-rule (4) of Rule 22 of the CGST Rules, 2017, for restoration of their registration. They relied on a similar order in WP(C) No.6366/2023 (Sanjoy Nath vs. The Union of India and others). Revenue's contention: The judgment records no specific arguments from the revenue side regarding the petitioner's contentions or the interpretation of the relevant rules and sections.