Mohd Sidiq vs. The Joint Commissioner (Appeals-1)

Held

The Court observed that the writ petition was filed on 06.11.2023, less than 10 days after the appeal was filed on 28.10.2023. Therefore, the Court considered the writ petition to be premature for granting the relief sought. However, the Court stated that if the petitioner has invoked the remedy of appeal before the Appellate Authority, the Appellate Authority shall examine the matter and decide it strictly in accordance with the provisions of law, which includes the power to consider the appeal beyond the period of limitation. The Court did not decide on the merits of the cancellation of registration or the appeal itself, but directed the Appellate Authority to consider the appeal.

Facts

The petitioner, Mohd Sadiq Contractor, filed a writ petition challenging the cancellation of his GST registration by the Superintendent of Central Tax (2nd Respondent) on 23.06.2023, effective from 24.03.2020. The registration was cancelled on the grounds that the petitioner was a fake entity with no business activity. The petitioner also challenged the non-disposal of his appeal filed on 28.10.2023 before the Joint Commissioner (Appeals-1) (1st Respondent). The petitioner sought a direction to the Appellate Authority to consider his appeal and to suspend the cancellation order, reviving his GST registration pending disposal of the writ petition. The writ petition was filed on 06.11.2023.

Key Issues

1. Whether the action of the respondents in non-disposing of the appeal filed by the petitioner dated 28.10.2023 is illegal, arbitrary, and a violation of natural justice and the provisions of the GST Act, 2017? 2. Whether the cancellation of the petitioner's GST registration certificate vide GST No. 36EESP8378B1ZP dated 23.06.2023 by the 2nd Respondent is arbitrary, illegal, and contrary to law? Petitioner's arguments: The petitioner contended that the respondents' inaction in disposing of his appeal is illegal and arbitrary. He sought a writ of mandamus to direct the Appellate Authority to consider his appeal and to set aside the cancellation order. Revenue's arguments: The learned counsel for the Department contended that the petitioner's existence was solely for availing Input Tax Credit (ITC) benefits and passing them on to other agencies without any actual supply. It was also argued that no business was being conducted at the registered premises. The Department also highlighted that the petitioner failed to take immediate steps for revocation of cancellation and did not prefer an appeal within the prescribed period under Section 107 of the CGST Act, 2017, nor availed the condonation of delay provision.