Rabindra Biswas vs. The Union Of INDIA 3 Ors.

Held

The Court held that the cancellation of GST registration entails serious civil consequences. It noted that the proviso to sub-rule (4) of Rule 22 of the CGST Rules, 2017, allows for dropping proceedings if a person, served with a show cause notice for non-furnishing of returns, furnishes all pending returns and makes full payment of tax dues, along with applicable interest and late fees. The Court found that the petitioner had updated his returns and paid his dues. Therefore, 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 he complies with all requirements as per the proviso to Rule 22(4), the authority shall consider the application for restoration in accordance with law and take necessary steps expeditiously. The Court also 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. The Court passed this order in the interest of justice, irrespective of the challenge to the appeal rejection order.

Facts

The petitioner, Rabindra Biswas, operating as M/s Rahul Enterprise, is registered under the CGST/AGST Act, 2017. Due to non-filing of GST returns for six months, he received a show cause notice dated 11.06.2024. He failed to reply within the stipulated 30 days, citing unfamiliarity with online procedures. Consequently, the Superintendent, II-A Range, passed an order dated 22.07.2024 cancelling his GST registration without assigning reasons. The petitioner later updated all pending returns up to June 2024, paid dues, late fees, and interest. However, he could not file an application for revocation of cancellation as the time limit of 270 days had expired. His subsequent appeal was dismissed on 12.08.2025. Aggrieved, he filed this writ petition.

Key Issues

1. Whether the cancellation of GST registration, without assigning reasons in the order, is valid under Section 29(2)(c) of the CGST Act, 2017, read with Rule 22 of the CGST Rules, 2017? The petitioner argued that the cancellation order was passed without assigning any reason, which is contrary to the principles of natural justice and the procedure laid down. He contended that he had updated all pending returns and paid all dues, interest, and late fees, and that the proviso to Rule 22(4) of the CGST Rules, 2017, should have been considered. The revenue did not record any specific arguments in the judgment, but their action of cancelling the registration implies they relied on Section 29(2)(c) for non-filing of returns.