Rinkukumari Vinod Kumar Singh (Prop. M/S R.S. Solutions) vs. Sales Tax Officer Class Ii / Avato-Ward 80 & Anr.
Original PDF →Facts
The petitioner, Rinkukumari Vinod Kumar Singh (Prop. M/s R.S. Solutions), filed a writ petition challenging the cancellation of their GST registration by the Sales Tax Officer Class II / AVATO-Ward 80. The petitioner's GST registration was cancelled due to a continuous default in filing returns for six months, as mandated by Section 39 of the CGST Act. A show cause notice was issued on 08.11.2022, and the petitioner's registration was suspended from the same date. The petitioner failed to respond to the show cause notice, leading to the cancellation order dated 26.07.2023, with the cancellation effective from 02.07.2017. An application for revocation was dismissed as it was filed beyond the three-month period stipulated under Section 107 of the CGST Act. The petitioner acknowledged the default but undertook to file all pending returns and pay outstanding dues.
Held
The Court allowed the writ petition, directing the respondents to restore the petitioner's GST registration. The decision was based on the petitioner's undertaking to file all necessary returns and pay all outstanding dues along with interest within one week of the registration being restored. The Court referenced previous judgments, including TVL. Suguna Cutpiece Centre v. Appellate Deputy Commissioner (ST) (GST) and M/s Rakesh Enterprises v. The Principal Commissioner Central Goods and Services Tax & Ors., emphasizing that the department's aim should not be to prevent taxpayers from conducting their business. The ratio decidendi is that substantial compliance and a commitment to rectify past defaults can warrant the restoration of a cancelled GST registration, provided it aligns with the broader objective of facilitating business. The Court clarified that if the petitioner fails to comply with the undertaking, the respondents are at liberty to proceed with the cancellation and initiate other recovery actions. No issue was expressly left undecided.
Key Issues
1. Whether the petitioner's GST registration, cancelled due to continuous non-filing of returns for six months under Section 39 of the CGST Act, should be restored, considering the petitioner's undertaking to file returns and pay dues. The petitioner argued that while they admit to the default in filing returns, they have undertaken to rectify the non-compliance by filing all pending returns and clearing outstanding dues, including interest. They relied on the principle that the department's objective should not be to preclude taxpayers from carrying on their business, citing TVL. Suguna Cutpiece Centre v. Appellate Deputy Commissioner (ST) (GST) and M/s Rakesh Enterprises v. The Principal Commissioner Central Goods and Services Tax & Ors. The respondents, represented by the ASC for GNCTD, did not record any specific arguments against the restoration in the judgment, other than the fact that the revocation application was filed beyond the statutory period.
Sections Cited
Section 39, Section 107
AI-generated summary — verify with the full judgment below
Cause title — parties, addresses and appearances
O R D E R % 23.09.2024
Issue notice.
The learned counsel for the respondents accepts notice.
The petitioner has filed the present petition impugning an order dated 26.07.2023 (hereafter the impugned cancellation order), whereby the petitioner’s GST registration was cancelled.
The petitioner was registered with the GST Authorities and was assigned the Goods and Services Tax Identification Number (GSTIN): 07C PS6903D1ZR. The petitioner had defaulted in filing its returns for a continuous period of six months.
In view of the above, the proper officer issued a show cause notice dated 08.11.2022 (hereafter the SCN) calling upon the petitioner to show cause as to why its GST Registration not be cancelled on account of failure This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 03/07/2025 at 08:29:53
to furnish the returns under Section 39 of the Central Goods and Services Tax Act, 2017 (hereafter the CGST Act) for a continuous period of six months. The petitioner was called upon to respond to the SCN within a period of thirty days from the date of the service of the SCN and was directed to appear before the proper officer on 08.12.2022. The petitioner’s GST Registration was also suspended with effect from the same date – 08.11.2022. 6. The petitioner did not respond to the SCN. Resultantly, by the impugned cancellation order, the petitioner’s GST registration was cancelled with effect from 02.07.2017. 7. The petitioner made an application for revocation of the impugned cancellation order, whereby its registration was cancelled. The proper officer dismissed the petitioner’s application as it was filed beyond the period of three months stipulated under Section 107 of the CGST Act.
The petitioner does not dispute that he has defaulted in complying with the provisions of Section 39 of the CGST Act and had not filed the returns as required. However, he undertakes that all returns will be filed and outstanding dues will be paid.
In TVL. Suguna Cutpiece Centre v. Appellate Deputy Commissioner (ST) (GST), SALEM: 2022 (61) G.S.T.L. 515 (Mad), the Hon’ble High Court of Madras had considered import of the actions of cancellation of a taxpayer’s GST registration and noticed that the department’s object cannot be to preclude taxpayers from carrying on their business. This Court has also taken a similar view in M/s Rakesh Enterprises v. The Principal Commissioner Central Goods and Services Tax & Ors.: Neutral Citaion This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 03/07/2025 at 08:29:53
No. 2023/DHC/001018. 10. In view of the above, we consider it apposite to allow the present petition and direct the respondents to restore the petitioner’s GST registration. However, this is subject to the condition that the petitioner shall immediately, within a period of one week of the petitioner’s GST registration being restored, file the necessary returns and pay all its dues along with interest.
In the event the petitioner does not comply with the aforesaid undertaking, the respondent shall proceed to cancel the petitioner’s GST registration.
It is also clarified that this would not preclude the respondent authorities from initiating any other action for non-compliance of the statutory provisions or recovery of any amount that may be due.
The petition is disposed of in the aforesaid terms. VIBHU BAKHRU, J SACHIN DATTA, J SEPTEMBER 23, 2024/at This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 03/07/2025 at 08:29:53
Reproduced from the public record of the Delhi High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.