Pronoti Sarkar vs. Union Of INDIA And 4 Ors
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The petitioner, Pronoti Sarkar, is engaged in works contract and hardware trading and holds a GST registration. Due to personal reasons, including ill health and lack of knowledge of online compliances, the petitioner failed to file GST returns regularly. Consequently, a show cause notice was issued on July 8, 2022, proposing cancellation of GST registration. An order dated August 10, 2022, was passed by the Assistant Commissioner, Central Goods and Service Tax, Silchar, cancelling the petitioner's GST registration. The petitioner filed an appeal against this order, which was pending before the Joint Commissioner (Appeals). The petitioner approached the High Court seeking urgent restoration of the GST registration, stating that its business activities were severely hampered by the cancellation.
Held
The Court held that the GST registration of the petitioner could be revoked with immediate effect upon the petitioner filing up-to-date returns and paying the due tax amount along with other statutory dues, as stipulated by Rule 23 of the CGST Rules, 2017. The reasoning was based on the submission made by the learned Standing Counsel for GST, who stated that this was the condition for revocation. The petitioner's counsel agreed to comply with this condition. Therefore, the Court found no justification for keeping the matter pending and directed the respondents to restore the GST registration immediately upon the petitioner fulfilling these requirements. The ratio decidendi is that a GST registration cancelled for non-filing of returns can be restored expeditiously if the taxpayer complies with the conditions laid down in Rule 23 of the CGST Rules, 2017, by filing pending returns and clearing all statutory dues.
Key Issues
1. Whether the GST registration of the petitioner should be restored immediately, considering the disruption to its business activities, under the provisions of the CGST Act and Rules. The petitioner argued that the cancellation of GST registration has severely hampered its business operations and sought an urgent order for its restoration. The petitioner contended that it had already deposited all necessary dues and would pay any further amounts required under the Rules. The respondents, represented by the learned Standing Counsel, GST, submitted on instruction that the cancellation of GST registration could be revoked with immediate effect if the petitioner filed up-to-date returns and paid the due tax amount along with other statutory dues as per Rule 23 of the CGST Rules, 2017.
Sections Cited
Rule 23
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Cause title — parties, addresses and appearances
ORDER 24.02.2023 Heard Shri RS Mishra, learned counsel for the writ petitioner. Also heard Shri S.C. Keyal, learned Standing Counsel, GST, appearing for the respondents.
The petitioner firm is engaged in the business of executing works contract and trading of hardware goods and, therefore, is required to have GST registration. The petitioner had accordingly obtained GST registration but due to certain reasons beyond the control of the petitioner, which includes the ill health and lack of knowledge about online compliances, the petitioner could not file its return regularly. Situated thus, a show cause notice dated 08.07.2022 was issued to the petitioner as to why its GST registration should not be cancelled. Thereafter, the impugned order dated 10.08.2022 has been issued cancelling the GST registration of the petitioner.
The appeal preferred by the petitioner against the impugned order dated 10.08.2022 is pending before the appellate authority.
Shri Mishra, the learned counsel submits that due to cancellation of the GST registration, the petitioner’s business activities has been seriously hampered. Under the circumstances, an urgent order for restoration of the GST registration is required to be passed by this Court.
Taking note of the grievance of the petitioner, this Court has directed the Page No.# 3/3 learned Standing Counsel, GST to obtain instructions and appraise this Court as to whether, any immediate relief can be granted to the petitioner.
Today, when the matter is called up, Shri Keyal, learned Standing Counsel submits on instruction that cancellation of the GST registration of the petitioner can be revoked with immediate effect if he files up-to-date return and pays the tax amount due along with other statutory due as per Rule 23 of the CGST Rules, 2017. 7. Shri Mishra, learned counsel for the petitioner submits that his client has already deposited all necessary dues but if any further amount is still payable under the Rules, the same will be paid.
If that be so, there is no justification for keeping this matter pending before this Court any further. Therefore, with the consent of both the sides, this writ petition is being disposed of by directing the respondents to restore the GST registration of the petitioner immediately on filing return along with deposit of statutory dues by the petitioner, in accordance with the Rules.
The aforesaid exercise be carried out as expeditiously as possible.
With the above observation, the writ petition stands disposed of. JUDGE Comparing Assistant
Reproduced from the public record of the Gauhati High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.