Pallab Kumar Pandit vs. The Union Of INDIA And 3 Ors

This writ petition is filed impugning the order dated 07.09.2021 passed by the respondent No. 4, namely, the Superintendent, Central Goods & Service Tax, Nagaon, Assam whereby the GST registration of the petitioner was cancelled in terms of the provisions of Section 29 of the Central Goods and Services Tax Act, 2017. 3. The petitioner is engaged in the business of works contracts primarily with the Public Works Departments (PWD), Government of Assam for construction of Road, Bridges and Govt.8 Building under the name and style of “M/s Pallab Kumar Pandit” having its registered office at 100, Namghar Path, Haiborgaon, Nagaon, Assam. According to the petitioner, the order of cancellation of the GST registration was passed without any notice to the petitioner. Subsequently, the petitioner came to be informed that a notice to show cause was issued to the petitioner in Form GST REG-17/31 vide Reference No. ZA180121061695M dated 07.01.2021. The said show cause was purportedly issued under Section 29(2) of the Central Goods and Services Tax Act, 2017 read with Rules 22(1) and Rules 21A(2A) of the Central Goods and Services Tax Act, 2017. However, vide the said notice, the GST registration of the petitioner was suspended on 07.01.2021 itself, namely, the date of issuance of the show cause notice. The petitioner is aggrieved that there was no personal notice served upon the petitioner prior to suspension and cancellation of Page No.# 3/6 the GST registration rather a notice was simply uploaded in the website of the department. According to the petitioner, such actions of the respondent authority are in complete violation of the Rules of natural justice as well as the provisions of the GST Act and the Rules. The learned counsel for the petitioner submits that this action of the respondent authorities is punitive in nature and has the effect of putting the business of the petitioner to a complete halt as without the GST registration he is unable to continue with his business as it is only source of his livelihood.

It is the submission of the learned counsel for the petitioner that since there was no personal notice served on the petitioner he came to be aware subsequently that his GST registration has been suspended and that a notice to show cause was issued by respondent No.

However, the said notice was put up only on the website of the department and, therefore, by the time the petitioner became aware of the suspension of his GST registration and subsequent cancellation of GST registration, the period of limitation as prescribed under the Act had already elapsed for filing an application for revocation of the cancellation of GST registration under Section 30 as well as for an Appeal under Section 107 of the CGST Act, 2017. It is, therefore, submitted that there being no other alternative remedy available to the petitioner, the present writ petition has been filed seeking appropriate writ, direction and orders from this Court to the respondent authorities. It is further submitted that the petitioner had already deposited the statutory dues.

The learned standing counsel has fairly submitted that there are orders passed by the other Co-ordinate Benches in respect of the cancellation of GST registration and, therefore, this writ petition can also be disposed of in terms of similar directions.

The learned counsels for the parties have been heard. Pleadings on record

Under Rule 23(1) of the GST Rules of 2017 it is provided that no application for revocation shall be filed unless such returns are furnished and any amount due as tax in terms of such returns has been paid along with any amount payable towards interest, penalty and late fee in respect of the said returns. The reasons for default on the part of the petitioner to submit its periodical returns as required under GST Act and the Rules, as pleaded in the present proceedings, are attributed to the financial losses suffered by the petitioner because of the COVID-19 Pandemic situation.

The purpose of limitation being prescribed in a statute is two fold, namely, to ensure compliance of the statutory provisions by the persons on whom the provisions of the statute are applicable and further to ensure that no third party rights which may have been created in the meantime are permitted to be non- suited/unsettled. Under the scheme of GST Act and Rules, the non-revocation of cancellation of GST registration is likely to prejudice the assessee alone. In cancellation of such GST registration for the reasons mentioned under the Section, it cannot be said that any third party rights are created against the assessee. No prejudice is caused to any other person, if the GST registration of the petitioner/assessee is revoked. No prejudice is caused to the revenue. Rather as discussed above, it will be in the interest of the revenue to permit the revocation of a cancellation of GST registration of an assessee like the petitioner so that it felicitates collection of revenue as mandated under the GST Regime.

Accordingly, the impugned order dated 07.09.2021 is hereby interfered with and set aside. The matter is remanded back to the departmental authority to re- consider his prayer for revocation of cancellation of GST registration.

It is directed that the respondent No. 4, namely, the Superintendent, Central