M/S. Z A Electricals And Constructions vs. Joint Commissioner Of Commercial Taxes
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Cause title — parties, addresses and appearances
ORAL ORDER
The petitioner has filed the captioned writ petition assailing the order for cancellation of GST registration dated 30.01.2019 and consequent impugned endorsement dated 25.07.2024 issued by respondent No.2 thereby declining to entertain the revocation application. The petitioner is also assailing the order of the Appellate Authority as per Annexure-A. HC-KAR NC: 2025:KHC:20494
Facts leading to the case are as under;
The petitioner is engaged in executing electrical and civil works and holds registration under the Goods and Services Tax Act, 2017, bearing GSTIN 29AFKPR3382P3ZE. It is the specific assertion of the petitioner that the Firm has been undertaking electrical works contracts for M/s. Karnataka Power Transmission Corporation Limited (KPTCL). The petitioner further contends that the Registration Certificate was issued by the competent authority under the provisions of the GST Act with effect from 19.08.2017, as evidenced at Annexure-B. While challenging the impugned order cancelling the registration, the petitioner submits that he was under a bona fide belief that his Auditor, acting on the inputs provided by the Office Staff, was regularly filing the monthly returns under the GST Act.
The petitioner asserts that he was unaware of the lapse until recently when it came to light, through his HC-KAR NC: 2025:KHC:20494 current Auditor, that the previous Auditor, who had been entrusted with all GST-related compliances, had passed away in October 2017. Consequently, the monthly returns from 2017 onwards were not filed. The petitioner further contends that although the contracted work was duly completed, the payments from KPTCL were not released, resulting in acute financial hardship.
As a result of non-filing of returns, respondent No.2 initiated proceedings under the GST Act and uploaded a Show Cause Notice dated 03.12.2018 in Form GST REG-17 on the GST portal, proposing cancellation of the petitioner’s registration on the ground of continuous default in filing returns for a period exceeding six months.
The learned counsel for the petitioner, reiterating the contentions urged in the writ petition, submits that the petitioner Firm is now ready and willing to file the pending returns and deposit the applicable taxes, along with HC-KAR NC: 2025:KHC:20494 interest and penalty, if granted reasonable time by this Court to ensure compliance in accordance with law.
Today, a detailed memo has been filed on behalf of the petitioner, stating that the tax liability pertains only to the financial years 2017–18 and 2018–19. While the petitioner expresses readiness to comply with the assessment orders for the years 2021–22, 2022–23, and 2024–25, it is submitted that no assessment orders have been passed yet for the financial years 2019–20 and 2020–21. In view of the above submission and the assurance extended by the learned counsel for the petitioner, this Court is inclined to show indulgence by granting an opportunity to the petitioner to regularize the tax filings and deposits.
Recording the above statement and assurance, this Court proceeds to pass the following: HC-KAR NC: 2025:KHC:20494 ORDER (i) The writ petition is hereby allowed. (ii) The impugned order dated 24.10.2024 passed by respondent No.1 in GST AP 431/24-25, as per Annexure-A, confirming the order dated 31.10.2019 bearing reference No. ZA2901190878580 issued by respondent No.2 cancelling the petitioner’s GST registration with effect from 30.01.2019, as per Annexure-A1, and the subsequent endorsement dated 25.07.2024 issued by respondent No.2 as per Annexure-A2, are hereby quashed and set aside. (iii) The matter is remitted to respondent No.2 for reconsideration in accordance with law. (iv) The petitioner is granted a period of four weeks from the date of receipt of this order to file all pending returns and deposit the tax dues along with applicable interest and penalty, in accordance with law. HC-KAR NC: 2025:KHC:20494 (v) In the event the petitioner fails to comply with the above direction within the stipulated time, the order of cancellation of GST registration shall stand revived automatically without further reference to this Court. (vi) The petitioner’s GST registration shall stand restored, subject to compliance with the above conditions and for the reasons stated in the preceding paragraphs of this order. (vii) Liberty is reserved to the petitioner to submit appropriate explanation and reply before the concerned authority, who shall consider the same strictly in accordance with law. (SACHIN SHANKAR MAGADUM) JUDGE
NBM List No.: 3 Sl No.: 1
Reproduced from the public record of the Karnataka High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.