Pranjit Bora vs. The State Of Assam And 2 Ors

Held

The Court held that the 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, interest, and late fees, the empowered officer has the authority to drop the proceedings. The Court directed that the petitioner should 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 sub-rule (4) of Rule 22, the authority shall consider the application and pass necessary orders. The Court also noted that the period stipulated under Section 73(10) of the CGST/SGST Act shall be computed from the date of the instant order, except for the financial year 2024-25, which will be as per Section 44. The petitioner is liable to pay arrears of tax, penalty, interest, and late fees.

Facts

The petitioner, Pranjit Bora, operating as "Pranjit Travels", had his GST registration cancelled by the Assistant Commissioner of State Tax, Guwahati-D-S, on April 9, 2024, due to non-filing of GST returns for a continuous period of six months. The cancellation followed a show cause notice dated March 2, 2023. The petitioner claimed he could not file a reply due to unfamiliarity with online procedures and losses during the Covid-19 pandemic. By the time he became aware of the notice, the reply and hearing period had expired. He was subsequently unable to file an application for revocation of cancellation as the 270-day time limit had elapsed. Aggrieved, he filed a writ petition before the High Court.

Key Issues

1. Whether the petitioner is entitled to seek restoration of his GST registration despite the expiry of the statutory time limit for revocation, considering the proviso to sub-rule (4) of Rule 22 of the CGST Rules, 2017? Petitioner's contention: The petitioner argued that he is ready and willing to comply with the formalities stipulated in 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 tax dues, along with interest and late fees, are paid. He relied on a similar case, Sanjoy Nath vs. Union of India and others (WP(C) No. 6366/2023). Revenue's contention: The judgment does not record any specific argument from the revenue's side regarding the petitioner's entitlement to restoration or the interpretation of the relevant rules.