Tarun Kumar vs. The Union Of INDIA

CWJC/10876/2024HC PatnaGSTCNR BRHC01061734202423 July 2024Bench: MR. JUSTICE PARTHA SARTHY,THE CHIEF JUSTICE-4 pages

AI SummaryDismissed

Facts

The petitioner, Tarun Kumar, challenged the cancellation of his GST registration, which was effective from January 3, 2020. This cancellation followed a show-cause notice issued on December 23, 2019, to which the petitioner did not reply. The petitioner also failed to avail the statutory appeal remedy provided under Section 107 of the Bihar Goods and Services Tax Act, 2017, which allowed for filing an appeal within three months and a further one-month condonation for delay. The petitioner did not utilize the extended limitation period granted by the Supreme Court due to the pandemic (up to May 30, 2022, or June 30, 2022, for delayed appeals). Furthermore, the petitioner did not avail of the Amnesty Scheme introduced by Circular No. 3 of 2023, which permitted restoration of cancelled registrations upon payment of dues between March 31, 2023, and August 31, 2023. The petitioner also did not controvert the allegation of not filing returns for six consecutive months.

Held

The Court held that the petitioner had failed to avail of multiple remedies provided to him. Firstly, he did not file a reply to the show-cause notice leading to the cancellation of his registration. Secondly, he did not file an appeal within the prescribed time under Section 107 of the BGST Act, nor did he avail of the extended limitation period granted by the Supreme Court due to the pandemic. Thirdly, he did not take advantage of the Amnesty Scheme offered by Circular No. 3 of 2023. The Court noted that the petitioner did not controvert the allegation of not filing returns for six consecutive months. Citing the principle that 'the law favours the diligent and not the indolent,' the Court found that the petitioner's delay was a significant factor against him. The Court dismissed the writ petition, declining to exercise its discretionary powers due to the petitioner's inaction and the expired remedies.

Key Issues

1. Whether the petitioner is entitled to challenge the cancellation of his GST registration after failing to avail the statutory appellate remedy and the Amnesty Scheme, given the significant delay and the principle that law favors the diligent? (Question of law). The petitioner contended that the cancellation order was passed without proper consideration of the circumstances, and that remedies like the Amnesty Scheme should be liberally applied. The petitioner relied on a previous judgment by one of the judges that directed revocation of cancellation under the Amnesty Scheme. The respondent revenue authorities argued that the petitioner had numerous opportunities to rectify the situation, including the statutory appeal and the Amnesty Scheme, all of which were not availed. They emphasized the petitioner's failure to reply to the show-cause notice and the long delay in approaching the court, highlighting that the law favors diligent individuals.

Sections Cited

Section 107

AI-generated summary — verify with the full judgment below

Cause title — parties, addresses and appearances

IN THE HIGH COURT OF JUDICATURE AT PATNA Civil Writ Jurisdiction Case No.10876 of 2024 ====================================================== Tarun Kumar Son of Baleshwar Singh, Resident of Village- Jiwan Chak, Near Shiv Mandir, P.S.- Shahjahanpur, District- Patna, Pin Code- 801304. ... ... Petitioner/s Versus 1. The Union of India through the Secretary, Ministry of Finance, Govt. of India, New Delhi. 2. The Secretary, Department of Revenue, Govt. of India, New Delhi. 3. The Principal Commissioner of Central Goods and Services, New Delhi. 4. The Commissioner of Central Tax, C.R. Building, Birchand Patel Path, Patna- I 5. The Joint Commissioner of State Tax, Patna East, Patna. 6. The Superintendent, Central Goods and Service Tax, Barh, Patna East, Patna. ... ... Respondent/s ====================================================== Appearance : For the Petitioner/s : Dr. Alok Kumar Sinha, Advocate For the Respondent/s : Mr. K.N. Singh, ASG Mr. Anshuman Singh, Sr. SC, CGST Mr. Devansh Shankar, Advocate ====================================================== CORAM: HONOURABLE THE CHIEF JUSTICE and HONOURABLE MR. JUSTICE PARTHA SARTHY

ORAL JUDGMENT (Per: HONOURABLE THE CHIEF JUSTICE) Date : 23-07-2024 The petitioner is before this Court challenging the cancellation of registration dated 03.01.2020 at Annexure-P/2, before which show-cause notice was issued as per Annexure- P/1 dated 23.12.2019, which was not replied to. An appeal is 2/4 provided from Annexure-P/2, which was also not availed of.

Section 107 of the Bihar Goods and Services Tax Act, 2017 (“BGST Act” hereafter) permits an appeal to be filed within three months and also apply for delay condonation with satisfactory reasons within a further period of one month. The Hon’ble Supreme Court, in Suo Motu Writ Petition (C) No. 3 of 2020, In Re: Cognizance For Extension of Limitation, due to the pandemic situation, saved limitation between 15.03.2020 till 28.02.2022. It was also directed that an appeal could be filed within ninety days from 01.03.2022. Hence, an appeal could have been filed on or before 30.05.2022, which provision was not availed by the petitioner herein. The Hon’ble Supreme Court also declared that if a longer period than 90 days is provided in a Statute, then that longer period will apply. Hence, a delayed appeal could also have been on or before 30.06.2022. 3. The petitioner has not availed such remedy and at this point of time, cannot seek to avail the appellate remedy for reason of the limitation period having expired long prior.

Annexure P/3 and P/4 decisions were based on the peculiar circumstance due to the pandemic, which has been reckoned by the Hon’ble Supreme Court in the cited 3/4 decision and a measure provided to get over the limitation which was not availed by the petitioner. Annexure-5 judgment is on the peculiar circumstances there, which has no application here.

Further, the Government had come out with an Amnesty Scheme by Circular No. 3 of 2023 by which the registered dealers, whose registrations were cancelled, were permitted to restore their registration, on payment of all dues, between 31.03.2023 to 31.08.2023. The petitioner did not avail of such remedy also.

The learned counsel relies on a judgment authorized by one of us (the C.J) dated 25.04.2023 in which a Division Bench directed revocation of cancellation made on 21.02.2022 on the terms of Circular No. 3 of 2023. First, the said order was in the currency of the Amnesty Scheme, then, the order was of 2022, while here the order challenged is of 2019; with gross delay.

The petitioner was not a registered dealer after cancellation and there was no monitoring of his activities by the Department in the intervening period. There is no way to ascertain as to whether there was any transaction carried out during the said period. There is also the fact that the petitioner 4/4 has not availed of the appellate remedy nor the Amnesty Scheme which was made applicable. The petitioner also does not in the memorandum of writ petition controvert the allegation in the show cause notice produced as Annexure-P/1 that no returns were filed for a consecutive six months period.

The law favours the diligent and not the indolent. The delay stands against the petitioner.

Hence, we dismiss the writ petition; declining exercise of discretion.

Harsh/- (K. Vinod Chandran, CJ) ( Partha Sarthy, J) AFR/NAFR NAFR CAV DATE NA Uploading Date .07.2024 Transmission Date 07.2024

Reproduced from the public record of the Patna High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.