M/S. Knowledge Partners vs. Superintendent (GST) - Telangana High Court, 12 September 2022

Cause title — parties, addresses and appearances

AND 1 2 HIGH COURT FOR THE STATE OF TELANGANA AT I{YDERABAD (Special Original Jurisdiction) MONDAY, THE TWELFTH DAY OF SEPTEMBER TWO THOUSAND AND TWENTY TWO PRESENT THE HONOURABLE THE CHIEF JUSTICE UJJAL BHUYAN AND THE HONOURABLE SRI JUSTICE C.V. BHASKAR REDDY WRIT PETITION NO: 34926 OF 2022 Between: M/s. Knowledge Partners, rep. by its Proprietor, Mr. [t/. Venkata Siva Rama Krishna Murthy, Flat No.401, 4th Floor, Padmaja Towers, 81, Srinigar Colony, Hyderabad- 500 073. ,..PETITIONER Supenntendent (GST), Jubilee Hills-|, Srinagar Colony, Hyderabad. Additional Commissioner (Appeals-l), Hyderabad Commissionerate, Hyderabad. State of Telangana, rep. by its Principal Secretary to Government, Revenue (CT-ll) Department, Secretariat, Hyderabad. Union of lndia, rep. by the Secretary, Ministry of Finance, 3rdFloor, Jeevan Deep Building, Sansad l\rlarg, New Delhi-l 10001 . ...RES,ONDENTS Petition under Article 226 o{ the Constitution of lndia praying that in the circumstances stated in the affidavit filed therewith, the High Court may be pleased to issue a Writ of Mandamus or any other appropriate writ or order or direction setting aside the order of the 2nd Respondent dated 23.8.2022, and order of the 1st Respondent dated 18.1.2022 as illegal, arbitrary and in violation of principles of natural justice and consequently restore the registration certificate granted to the Petitioner under the CGST / TGST Act, 2017 lA NO;1 OF 2022 Petition under Section 151 CPC praying that in the circumstances stated in the affidavit filed in support of the petition, the High Court may be pleased to suspend the impugned order of the 2nd Respondent daled 23.8.2022, pending disposal of the Writ Petition as otherwise the Petitioner will be put to severe loss and hardship. counsel for the Petitioner :rus.x.drue FoR sRl. v. GANGADHAR SASTRY Counsel for the Respondent Nos.1, 2 & 3: SRI B. NARASIMHA SARMA Counsel for the Respondent No.4: SRI B. MUKHERJEE,FOR ASSISTANT SOLICITOR GENERAL 4

The Court made the following: ORDER I I

I'HI' H N'BLE 'f I II] Ct{TEfT ITJSTI(]E UIIAL }II I J\ .AI\i AND TT{E F ON'BLE SRI IUSTICE C.V.BHASK\R RFI)DY V'. P.Ntr. 31()26 of 20ZZ Q@E&, tPrz,, Ilo u1,.rh.Ch4 lu,h-e Ljat BtnLrt Hcard I\ .s. I(.Uma, lcamcd counsel firr rf r: pctltioncr; Mr. Il.Narsiml r Sarma, lcarnccl counscl lor resp<>rLclents No.1, 2 and 3; and Mr R.Mukherjec, learned counsel rdprcs(:nrin!; learned Assistant Solici or General of India for respondcnt Nr>.,r.

Bv ftling this pctiuon r-rndcr Atticlc 226 'tf thr t.-or,stitution crf India, perir .oner seeks quashing o[ orders aarcc] 1,8.01,.2022 and23.08.202! o[respondents No.1 and 2 rcspcctirrll' anC further seeks a direct rn to respondent No.1 to restrlre rlre re1$stration certificate issu :d to the petitioner under the Centr rl Goods and Services Tax I ct, 2017 Snefiy'the CGST Act' hercin:rfter) as well as uflder the l elangana Goods and Services Tax,\cr, :t-01,1 briefly 'the TGST'Ac ' hereinafter).

It may be mentioned that petitioner is a proprietorship d,-,,.. concern and r rlpged in the business of execudon cf ma:eagement I ! consultancy s rr.ices, which is rcgistered under the CGST Act as I

we ll as under thc 't'GS'l' Act. Ilcspondent No.1 issucd order clated 18.01.2022 cancelling the rcgistration of thc peritioner

Ordcr datcd 18.01 .2022 discloses that show causc notice was issued on 02.12.2021 as to why registration ol the petitioner should not be cancclled. Petitioner submitted reply date d 02.01.2022. However, respondent No1 passed the impugned order of cancelladon clltecl 1 8.01 .2022 on the Following ground: An1, pending tax arrcars, intcrest and penalty must bc deposited immediately. The cancellation does not affect the tiability or othcr dues fot aoy period pdor to the datc of cancellation rvhether or not such tax or othet dues ate determined befote or after the date of cancellation. You are requted to file a final tetutn within thtee months of date of cancellation, in form GSTR-1O through the commofl portal.

From a perusal o[ the above, we find that the above is not a gtound at all to ordet canceilation of registration. All that it says is that notwithstanding cancellation o[ registration, petitioncr was required to deposit pending tax arrears, interest and penalty.

Ile that a rt ma1,, petitioncr filccl appcal beftrr,: :cspondcnt No.2 assailing hc ordcr of cancellation datcd 18.( 1.2-O2tl. It is statcd that rvhil the appeal was hled rvrthin time, certiiied copy of rhe order datec 18.01.2022 ct>uld bc filed a[ter nvo,lays. By the ordcr dated 23 J8.2022, respondent No.2 stated thar rpp,sal v/25 F ed crnline or 12.05.2022 whereas ccrrified <:opy ;l' the order appcaled agains rvas filcd on 20.05.2022. 'I'herr'fore, d'Lte of filing of the appcal v as construed to be 20.05.2022. ,\ppel atc authority noted that in d e appeal, appcllant (pctiuoncr) hacl :r rt challenged the order of ;ancellation ancl only sought for: r:voc:-tion o[ canceilation o[ :egistration, thc period for whicl rvas e xtetded till 30.09.2021. T rerefore, cven i[ the appeai was con.stl:u,:d :o be an application for :cvocation of cancellation of rcp;rstraton, the same was batred b1 Lirnitation. Hence, the appe al '.t dismis sed. Aggdeved then bv, present writ petition has been filed

W'e have been informed at the bar that thou3b tlere is a provision for further appeal before the GST f ribuna-l under Section 11,2 rf the CGST Act, no such f'ribtrra-l has been / I I I

{ constituted till datc in the State of Telangana. In suclr circumstances, thc rvrit pctition has bcen fiicd. 8. 'Ihough rcspondenr No.2 as the appellatc authorlty may be technically right in rcjccting thc appeal of the petitiofler, we are however, of thc r.icrv that thc orde t dated 18.01.2022 as extracted abovc is devoicl of any reason whatsoever justifying cancellation of registration. All that thc order says is that notwithstanding cancellation c-r f registration, thc petitioner is bound to pay the pending tax arrcars, intercst and penalty. By no stretch of imagination, such consequcnccs can be construed to be gounds o[ rejection. Thercfore, wc are of the view that it would be just and proper if the entire matter is remanded back to respondent No.1 to reconsider the case of the petitioner and thereafter, to pass appropriate order in accordance with law.

In the l-ight o[ the above and without expressing any opinion on merit, we set asidc the orders dated 18.01.2022 and23.08.2022 of respondents No.1 and 2 respectively and remand the matter / back to the file oF respondent No.1 to consider the case of the petitioner agaj rst cancellation ol (lS'l' rcgistrali()n ::rr'-l t rereafrcr, pass appropri Lte order in accordancc rvith lari'. \c':diess tt> mendon, rvhil passing such orde r, respondcn' N <.'. . ,;ha[l give an opporrunity o hearing to the petitioner. 'l'he abor-t t xelcise shall be carried ou within a Pe riod of rwo m()nth s {:1r',rrt thr: date of rece\;t of a co xr o[ this order.

10.

Furthcr, it would be opcn t() thc Petitioner t, r s Ltbnlit all the returns and pa , rhe pending tax arrcars as Pcr the :.t:tlr.rlc.

11.

This dis ,oses of the writ petition. No r:osts As a se 1uel, miscellaneous petitions, pt ndin.u r I any, stand dismissccl. \ //// .r.NAGA tadAnt DEPUI}REGISTRAR 1r' S,ECTION OFFICER To,1. The Superint( ldent (GST), Jubilee HillsJ, Srinagar Colory, Hyderabad.

The Additiona Commissioner (Appeals-l), Hyderabad Commissionerate, Hyderabad. 3.7he Principal iecretary to Government, Revenue r'CT-ll) Depe rtment, Secretariat, S ate of Telangana Hyderabad

The Secretarl tvlinistry of Finance, Union of lndia, 3nlFkror, Jeevan Deep Building, S One CC to anr ad Marg, New Delhi-1 10001 Sr V. Gangadhar Sastry, Advocate [OPUC]

One CC to Sr B Narasimha Sa ukherjee, Assistant Solicito rma, SC [OPUcl rGeneral OPUIII

One CC to Sr B. M

Two rccs to C c for 9. Two CD Copir s

10.

One Spare C< cy R CH P commercial taxesr6ffi 1\rc"r* S: +* :Lla o? <"\."p"- GJ-t) I

HIGH COUR'I DATE D: 12105 t2022 ORDER W.P.No.3492i ot 2022 DISPOSING ( }F THE WRIT PETITION WITHOUT C(,STS /^ ,( { tL ..) .rry s8 I.,) ar \ \ 1b (, ?.=