Kamaljeet Singh And Sons HUF vs. The State Of Assam And 4 Ors

Facts

The petitioner, Kamaljeet Singh And Sons HUF, challenged an order dated November 5, 2022, which cancelled its GST registration. The petitioner subsequently filed an appeal against this cancellation order, but it was rejected on March 17, 2023, as time-barred. The petitioner argued that the cancellation was due to non-filing of returns, which have since been filed, and that continuing the cancellation would cause prejudice. The respondent authorities, represented by the Standing Counsel, submitted that the rejection of the appeal on limitation grounds was in accordance with the law.

Held

The Court held that given the facts and circumstances, and the fact that the sole reason for cancellation of GST registration was non-submission of returns for a particular period, which the petitioner has since rectified by filing the returns, the order of cancellation should be revoked. The Court directed the authorities to revoke the cancellation order and reinstate the GST registration, provided the petitioner has indeed filed the returns. This direction is subject to the condition that the returns are accompanied by all statutory dues and/or penalties. The Court did not explicitly decide on the legality of the time-barred rejection of the appeal itself, but rather focused on the rectification of the underlying issue that led to the cancellation. The ratio is that where a GST registration is cancelled for non-filing of returns, and the returns are subsequently filed along with dues/penalties, the cancellation should be revoked to avoid prejudice, even if the appeal against the cancellation was time-barred.

Key Issues

1. Whether the rejection of the petitioner's appeal as time-barred, against the order cancelling its GST registration, is legally sustainable, considering the petitioner has since filed the pending returns? (Mixed question of law and fact, turning on principles of procedural fairness and the intent of GST law). Petitioner's arguments: The petitioner contended that the sole reason for cancellation was non-filing of returns, which has been rectified by filing the returns. They argued that further continuation of the cancellation would serve no fruitful purpose for the department and would cause grave prejudice and hardship to the petitioner. They implicitly argued for a lenient view based on the rectification of the default. Revenue's arguments: The respondent authorities, through the Standing Counsel, argued on instructions that the rejection of the appeal on the ground of limitation was in accordance with the prescriptions of law.